Leases

12 Months Ended

Dec. 31, 2022

LEASES

The Company has operating leases for office space, warehouses, distribution centers, research and development facilities, manufacturing locations and certain equipment, primarily automobiles. Many leases include one or more options to renew, some of which include options to extend the leases for up to 30 years, and some leases include options to terminate the leases within 30 days. In certain of the Company’s lease agreements, the rental payments are adjusted periodically to reflect actual charges incurred for common area maintenance, utilities, inflation and/or changes in other indexes. The Company’s finance leases were not material as of December 31, 2022 and 2021. Right-of-use (“ROU”) assets arising from finance leases are included in property, plant and equipment, net and the liabilities are included in notes payable and current portion of long-term debt and long-term debt in the accompanying Consolidated Balance Sheets.

The Consolidated Financial Statements include the following amounts related to operating leases where the Company is the lessee ($ in millions):


		2022		2021			2020
Consolidated Statements of Earnings
Fixed operating lease expense (a)		$	239	$	246		$	216
Variable operating lease expense		73		59			46
Total operating lease expense		$	312	$	305		$	262

Consolidated Statements of Cash Flows
Cash paid for amounts included in the measurement of operating lease liabilities		$	259	$	243		$	221
ROU assets obtained in exchange for operating lease obligations		212		289			246

Consolidated Balance Sheets				December 31, 2022			December 31, 2021
Lease Assets and Liabilities	Classification
Operating lease ROU assets	Other long-term assets			$	1,001		$	1,041

Operating lease liabilities - current	Accrued expenses and other liabilities			$	199		$	207
Operating lease liabilities - long-term	Other long-term liabilities			863			889
Total operating lease liabilities				$	1,062		$	1,096

Weighted average remaining lease term				8 years			8 years
Weighted average discount rate				2.7		%	2.7		%

(a) Includes short-term leases and sublease income, both of which were immaterial.

The following table presents the maturity of the Company’s operating lease liabilities as of December 31, 2022 ($ in millions):


2023	$	222
2024	189
2025	156
2026	126
2027	99
Thereafter	401
Total operating lease payments	1,193
Less: imputed interest	(131)
Total operating lease liabilities	$	1,062

As of December 31, 2022, the Company had no additional significant operating or finance leases that had not yet commenced.