Long-term Employee Benefits

12 Months Ended

Dec. 31, 2022

Retirement Benefits, Description [Abstract]

Long-term Employee Benefits

27. Long-term Employee Benefits

Plans Covering Employees in the U.S.

Chemours established a defined contribution plan, which covered all eligible U.S. employees. The purpose of the plan is to encourage employees to save for their future retirement needs. The plan is a tax-qualified contributory profit-sharing plan, with cash or deferred arrangement, and any eligible employee of Chemours may participate. Chemours matches 100% of the first 6% of the employee’s contribution election, and the plan’s matching contributions vest immediately upon contribution. In 2021, the Company enhanced its previous discretionary retirement savings contribution to provide eligible employees with a guaranteed annual contribution ranging from 1% to 3% for the first $0.1 of base salary based on age and years of service.

Plans Covering Employees Outside the U.S.

Pension coverage for employees of Chemours’ non-U.S. subsidiaries is provided, to the extent deemed appropriate, through separate plans established after the Separation and comparable to the EID plans in those countries. Obligations under such plans are either funded by depositing funds with trustees, covered by insurance contracts, or unfunded.

The following table sets forth the Company’s net periodic pension (cost) income and amounts recognized in other comprehensive income (loss) for the years ended December 31, 2022, 2021 and 2020.

	Year Ended December 31,
	2022			2021			2020
Service cost	$	(14	)	$	(15	)	$	(15	)
Interest cost		(7	)		(5	)		(6	)
Expected return on plan assets		18			20			17
Amortization of actuarial loss		(8	)		(7	)		(9	)
Amortization of prior service gain		2			2			3
Settlement loss		—			(1	)		(5	)
Curtailment gain		—			—			1
Total net periodic pension cost	$	(9	)	$	(6	)	$	(14	)
Net (loss) gain	$	(2	)	$	(22	)	$	4
Prior service benefit (cost)		2			—			(1	)
Amortization of actuarial loss		8			7			9
Amortization of prior service gain		(2	)		(2	)		(3	)
Settlement loss		—			1			5
Curtailment gain		—			—			4
Effect of foreign exchange rates		7			6			(9	)
Benefit (cost) recognized in other comprehensive income		13			(10	)		9
Total changes in plan assets and benefit obligations recognized in other comprehensive income	$	4		$	(16	)	$	(5	)

The following table sets forth the pre-tax amounts recognized in accumulated other comprehensive loss at years ended December 31, 2022, 2021 and 2020.

	Year Ended December 31,
	2022			2021			2020
Net loss	$	132		$	148		$	143
Prior service credit		(9	)		(9	)		(12	)
Total amount recognized in accumulated other comprehensive loss	$	123		$	139		$	131

The following table sets forth summarized information on the Company’s pension plans at December 31, 2022 and 2021.

	December 31,
	2022			2021
Change in benefit obligation:
Benefit obligation at beginning of year	$	575		$	584
Service cost		14			15
Interest cost		7			5
Plan participants’ contributions		2			2
Actuarial (gain) loss		(145	)		19
Benefits paid		(5	)		(4	)
Plan amendments		(2	)		—
Settlements and transfers		(4	)		(11	)
Currency translation		(35	)		(35	)
Benefit obligation at end of year		407			575
Change in plan assets:
Fair value of plan assets at beginning of year		585			604
Actual return on plan assets		(129	)		17
Employer contributions		10			17
Plan participants’ contributions		2			2
Benefits paid		(5	)		(4	)
Settlements and transfers		(4	)		(11	)
Currency translation		(37	)		(40	)
Fair value of plan assets at end of year		422			585
Total funded status at end of year	$	15		$	10

The following table sets forth the net amounts recognized in the Company’s consolidated balance sheets at December 31, 2022 and 2021.

	December 31,
	2022			2021
Non-current assets	$	50		$	55
Current liabilities		(1	)		(1	)
Non-current liabilities		(34	)		(44	)
Total net amount recognized	$	15		$	10

The accumulated benefit obligation for all pension plans was $357 and $493 as of December 31, 2022 and 2021, respectively.

For the year ended December 31, 2022, the liability component of the Company’s global pension plans generated a net actuarial gain of $145, mainly driven by $209 gain as a result of increases in discount rates. The gain was partially offset by $64 of losses primarily due to the impact of inflation and salary scale assumptions.

The asset component of the Company’s global pension plans realized a loss of $147 due to volatile equity and bond performance.

The following tables set forth information related to the Company’s pension plans with projected and accumulated benefit obligations in excess of the fair value of plan assets at December 31, 2022 and 2021.

	December 31,
Pension plans with projected benefit obligation in excess of plan assets	2022		2021
Projected benefit obligation	$	121	$	142
Accumulated benefit obligation		104		119
Fair value of plan assets		86		97

	December 31,
Pension plans with accumulated benefit obligation in excess of plan assets	2022		2021
Projected benefit obligation	$	121	$	142
Accumulated benefit obligation		104		119
Fair value of plan assets		86		97

Assumptions

The Company generally utilizes discount rates that are developed by matching the expected cash flows of each benefit plan to various yield curves constructed from a portfolio of high-quality, fixed income instruments provided by the plans’ actuaries as of the measurement date. The expected rate of return on plan assets reflects economic assumptions applicable to each country.

The following tables set forth the assumptions that have been used to determine the Company’s benefit obligations and net benefit cost at December 31, 2022 and 2021.

	December 31,
Weighted-average assumptions used to determine benefit obligations	2022			2021
Discount rate		3.6	%		1.4	%
Rate of compensation increase (1)		3.5	%		3.4	%
Interest crediting rate (2)		2.5	%		1.0	%

(1)The rate of compensation increase represents the single annual effective salary increase that an average plan participant would receive during the participant’s entire career at Chemours.

(2)The interest crediting rate, which is applicable only for account balance type plans, represents the single effective annual account balance increase that an average participant would receive during the participant’s entire career at Chemours.

	December 31,
Weighted-average assumptions used to determine net benefit cost	2022			2021
Discount rate		1.4	%		1.0	%
Rate of compensation increase (1)		3.4	%		2.5	%
Expected return on plan assets		1.0	%		1.2	%

(1)The rate of compensation increase represents the single annual effective salary increase that an average plan participant would receive during the participant’s entire career at Chemours.

Plan Assets

Each pension plan’s assets are invested through either an insurance vehicle, a master trust fund, or a stand-alone pension fund. The strategic asset allocation for each plan is selected by management, together with the pension board, where appropriate, reflecting the results of comprehensive asset and liability modeling. For assets under its control, Chemours establishes strategic asset allocation percentage targets and appropriate benchmarks for significant asset classes with the aim of achieving a prudent balance between return and risk. Strategic asset allocations in countries are selected in accordance with the laws and practices of those countries.

The following table sets forth the weighted-average allocation for the Company’s pension plan assets at December 31, 2022 and 2021.

	December 31,
	2022			2021
Cash and cash equivalents		11	%		8	%
U.S. and non-U.S. equity securities		36	%		37	%
Fixed income securities		53	%		55	%
Total weighted-average allocation		100	%		100	%

Fixed income securities include corporate-issued, government-issued, and asset-backed securities. Corporate debt investments encompass a range of credit risk and industry diversification.

Fair value calculations may not be indicative of net realizable value or reflective of future fair values. Furthermore, although Chemours believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date.

The following tables set forth the fair values of the Company’s pension assets by level within the fair value hierarchy at December 31, 2022 and 2021.

	Fair Value Measurements at December 31, 2022
	Total		Level 1		Level 2
Asset category:
Debt - government issued	$	47	$	7	$	40
Debt - corporate issued		113		23		90
U.S. and non-U.S. equities		151		31		120
Derivatives - asset position		40		—		40
Cash and cash equivalents		48		48		—
Other		2		—		2
Total pension assets at fair value		401	$	109	$	292
Pooled mortgage funds (1)		21
Total pension assets	$	422

(1)Pooled mortgage funds consist of funds that invest in residential mortgages. These funds generally allow for monthly redemption with 30 days' notice. Timing for redemption could be delayed based on the priority of the Company's request and the availability of funds. Interests in these funds are valued using the net asset value ("NAV") per share practical expedient and are not classified in the fair value hierarchy.

	Fair Value Measurements at December 31, 2021
	Total		Level 1		Level 2
Asset category:
Debt - government issued	$	74	$	10	$	64
Debt - corporate issued		147		29		118
U.S. and non-U.S. equities		217		44		173
Derivatives - asset position		70		—		70
Cash and cash equivalents		46		46		—
Other		3		—		3
Total pension assets at fair value		557	$	129	$	428
Pooled mortgage funds (1)		28
Total pension assets	$	585

(1)Pooled mortgage funds consist of funds that invest in residential mortgages. These funds generally allow for monthly redemption with 30 days' notice. Timing for redemption could be delayed based on the priority of the Company's request and the availability of funds. Interests in these funds are valued using the NAV per share practical expedient and are not classified in the fair value hierarchy.

For pension plan assets classified as Level 1 instruments within the fair value hierarchy, total fair value is either the price of the most recent trade at the time of the market close or the official close price, as defined by the exchange on which the asset is most actively traded on the last trading day of the period, multiplied by the number of units held without consideration of transaction costs.

For pension plan assets classified as Level 2 instruments within the fair value hierarchy, where the security is frequently traded in less active markets, fair value is based on the closing price at the end of the period; where the security is less frequently traded, fair value is based on the price a dealer would pay for the security or similar securities, adjusted for any terms specific to that asset or liability. Market inputs are obtained from well-established, recognized vendors of market data and subjected to tolerance and/or quality checks. For derivative assets and liabilities, standard industry models are used to calculate the fair value of the various financial instruments based on significant observable market inputs, such as foreign exchange rates, commodity prices, swap rates, interest rates, and implied volatilities obtained from various market sources. With the exception of pooled mortgage funds, pooled funds are valued at the per-unit NAV as determined by the fund manager based on the value of the underlying traded securities.

Cash Flows – Defined Benefit Plans

Employer Contributions

For the years ended December 31, 2022, 2021 and 2020, Chemours contributed $10, $17, and $20, respectively, to its defined benefit plans.

Chemours expects to contribute $11 to its pension plans in 2023. The Company’s future contributions to its defined benefit pension plans are dependent on market-based discount rates, and, as stated in “Note 2 – Basis of Presentation” to these consolidated financial statements, may differ due to the impacts of the COVID-19 pandemic on the macroeconomic environment and other factors.

Future Benefit Payments

The following table sets forth the benefit payments that are expected to be paid by the plans over the next five years and the five years thereafter.

2023	$	11
2024		13
2025		14
2026		15
2027		18
2028 to 2032		111

Cash Flows – Defined Contribution Plan

Employer Contributions

For the years ended December 31, 2022, 2021 and 2020, Chemours contributed $31, $28, and $27, respectively, to its defined contribution plan.