Retirement Benefits

6 Months Ended

Jun. 30, 2023

Retirement Benefits [Abstract]

Retirement Benefits

Retirement Benefits

The Company maintains qualified and non-qualified defined benefit pension plans for its U.S. and non-U.S. eligible employees. The Company’s policy for funding its tax-qualified defined benefit retirement plans is to contribute amounts at least sufficient to meet the funding requirements set forth by U.S. law and the laws of the non-U.S. jurisdictions in which the Company offers defined benefit plans.

The weighted average actuarial assumptions utilized to calculate the net periodic benefit costs for the U.S. and significant non-U.S. defined benefit plans are as follows:

Combined U.S. and significant non-U.S. Plans	Pension Benefits
June 30,	2023		2022
Weighted average assumptions:
Expected return on plan assets	5.31	%	4.56	%
Discount rate	5.16	%	2.28	%
Rate of compensation increase	3.16	%	2.16	%

The target asset allocation for the U.S. plans is 50% equities and equity alternatives and 50% fixed income. At June 30, 2023, the actual allocation for the U.S. plans was 50% equities and equity alternatives and 50% fixed income. The target allocation for the U.K. plans at June 30, 2023 is 14% equities and equity alternatives and 86% fixed income. At June 30, 2023, the actual allocation for the U.K. plans was 13% equities and equity alternatives and 87% fixed income. The Company's U.K. plans comprised approximately 79% of non-U.S. plan assets at December 31, 2022. The assets of the Company's defined benefit plans are diversified and are managed in accordance with applicable laws and with the goal of maximizing the plans' real return within acceptable risk parameters. The Company generally uses threshold-based portfolio re-balancing to ensure the actual portfolio remains consistent with target asset allocation ranges.

The net benefit cost or credit of the Company's defined benefit plans is measured on an actuarial basis using various methods and assumptions. The components of the net benefit credit for defined benefit plans are as follows:

Combined U.S. and significant non-U.S. Plans
For the Three Months Ended June 30,	Pension Benefits
(In millions)	2023		2022
Service cost	$	5	$	7
Interest cost	150		99
Expected return on plan assets	(215)		(197)
Recognized actuarial loss	5		37
Net periodic benefit credit	$	(55)	$	(54)
Settlement loss	—		2
Net benefit credit	$	(55)	$	(52)

Combined U.S. and significant non-U.S. Plans
For the Six Months Ended June 30,	Pension Benefits
(In millions)	2023		2022
Service cost	$	11	$	15
Interest cost	298		199
Expected return on plan assets	(427)		(399)
Recognized actuarial loss	11		76
Net periodic benefit credit	$	(107)	$	(109)
Settlement loss	—		2
Net benefit credit	$	(107)	$	(107)

Amounts recorded in the Consolidated Statements of Income
Combined U.S. and significant non-U.S. Plans
For the Three Months Ended June 30,	Pension Benefits
(In millions)	2023		2022
Compensation and benefits expense	$	5	$	7
Other net benefit credits	(60)		(59)
Net benefit credit	$	(55)	$	(52)

Amounts Recorded in the Consolidated Statement of Income
Combined U.S. and significant non-U.S. Plans
For the Six Months Ended June 30,	Pension Benefits
(In millions)	2023		2022
Compensation and benefits expense	$	11	$	15
Other net benefit credits	(118)		(122)
Net benefit credit	$	(107)	$	(107)

U.S. Plans only
For the Three Months Ended June 30,	Pension Benefits
(In millions)	2023		2022
Interest cost	$	65	$	49
Expected return on plan assets	(77)		(84)
Recognized actuarial loss	4		18
Net benefit credit	$	(8)	$	(17)

U.S. Plans only
For the Six Months Ended June 30,	Pension Benefits
(In millions)	2023		2022
Interest cost	$	130	$	97
Expected return on plan assets	(155)		(168)
Recognized actuarial loss	9		37
Net benefit credit	$	(16)	$	(34)

Significant non-U.S. Plans only
For the Three Months Ended June 30,	Pension Benefits
(In millions)	2023		2022
Service cost	$	5	$	7
Interest cost	85		50
Expected return on plan assets	(138)		(113)
Recognized actuarial loss	1		19
Net periodic benefit credit	$	(47)	$	(37)
Settlement loss	—		2
Net benefit credit	$	(47)	$	(35)

Significant non-U.S. Plans only
For the Six Months Ended June 30,	Pension Benefits
(In millions)	2023		2022
Service cost	$	11	$	15
Interest cost	168		102
Expected return on plan assets	(272)		(231)
Recognized actuarial loss	2		39
Net periodic benefit credit	$	(91)	$	(75)
Settlement loss	—		2
Net benefit credit	$	(91)	$	(73)

The Company made contributions to its U.S. and non-U.S. defined benefit pension plans for the three and six months ended June 30, 2023 of approximately $26 million and $47 million, respectively, compared to contributions of $45 million and $113 million, respectively, for the corresponding periods in the prior year. The Company expects to contribute approximately $59 million to its U.S. and non-U.S. defined benefit pension plans during the remainder of 2023.

Defined Contribution Plans

The Company maintains certain defined contribution plans ("DC Plans") for its employees, the most significant being in the U.S. and the U.K. The cost of the U.S. DC Plans for the three and six months ended June 30, 2023 was $44 million and $88 million, respectively, and $40 million and $83 million, respectively, for the corresponding periods in the prior year. The cost of the U.K. DC Plans for the three and six months ended June 30, 2023, was $38 million and $81 million, respectively, and $33 million and $77 million, respectively, for the corresponding periods in the prior year.