XML 58 R37.htm IDEA: XBRL DOCUMENT v3.22.0.1
RETIREMENT PLANS (Tables)
12 Months Ended
Dec. 31, 2021
Retirement Benefits [Abstract]  
Schedule of Change in Benefit Obligation and Plan Assets, Funded Status and Amounts Recognized in Balance Sheet and Accumulated Other Comprehensive Income (Loss)
Below is a summary balance sheet of the change in plan assets during 2021 and 2020, the funded status of the plans and amounts recognized in the Consolidated Statements of Financial Position.

Summary of Changes
Pension Plans
Postretirement Benefit Plans
2021202020212020
(Dollars in millions)U.S.Non-U.S.U.S.Non-U.S.
Change in projected benefit obligation:
Benefit obligation, beginning of year$2,050 $1,089 $2,067 $972 $745 $716 
Service cost26 19 25 17 — — 
Interest cost37 12 57 15 12 19 
Actuarial (gain) loss (49)(68)203 66 (40)57 
Settlement(6)— (122)(6)— — 
Divestitures— (32)— — (2)— 
Plan amendments and other— — — (12)— — 
Plan participants' contributions— — 10 
Effect of currency exchange— (43)— 61 — — 
Federal subsidy on benefits paid— — — — 
Benefits paid(166)(30)(180)(25)(60)(58)
Benefit obligation, end of year$1,892 $948 $2,050 $1,089 $665 $745 
Change in plan assets:
Fair value of plan assets, beginning of year$1,798 $938 $1,919 $820 $144 $139 
Actual return on plan assets247 31 175 72 18 
Effect of currency exchange— (39)— 54 — — 
Company contributions23 22 40 39 
Reserve for third party contributions— — — — (7)(5)
Plan participants' contributions— — 10 
Benefits paid(166)(30)(180)(25)(60)(58)
Federal subsidy on benefits paid— — — — 
Settlements(6)— (122)(6)— — 
Fair value of plan assets, end of year$1,877 $924 $1,798 $938 $134 $144 
Funded status at end of year$(15)$(24)$(252)$(151)$(531)$(601)
Amounts recognized in the Consolidated Statements of Financial Position consist of:
Other noncurrent assets$41 $42 $— $$62 $57 
Current liabilities(3)— (3)(1)(38)(46)
Post-employment obligations(53)(66)(249)(151)(555)(612)
Net amount recognized, end of year$(15)$(24)$(252)$(151)$(531)$(601)
Accumulated benefit obligation$1,803 $910 $1,979 $1,036 
Amounts recognized in accumulated other comprehensive income consist of:
Prior service (credit) cost$$(10)$$(11)$(68)$(105)
Defined Benefit Plan, Plan with Projected Benefit Obligation in Excess of Plan Assets [Table Text Block] Information for pension plans with projected benefit obligations in excess of plan assets:
(Dollars in millions)20212020
U.S.Non-U.S.U.S.Non-U.S.
Projected benefit obligation$175 $288 $2,050 $769 
Fair value of plan assets119 222 1,798 617 
Defined Benefit Plan, Plan with Accumulated Benefit Obligation in Excess of Plan Assets [Table Text Block] Information for pension plans with accumulated benefit obligations in excess of plan assets:
(Dollars in millions)20212020
U.S.Non-U.S.U.S.Non-U.S.
Accumulated benefit obligation$161 $272 $1,979 $693 
Fair value of plan assets119 222 1,798 574 
Schedule of Benefit Cost and Amounts Recognized in Other Comprehensive Income Summary of Benefit Costs and Other Amounts Recognized in Other Comprehensive Income
 Pension PlansPostretirement Benefit Plans
202120202019202120202019
(Dollars in millions)U.S.Non-U.S.U.S.Non-U.S.U.S.Non-U.S.
Components of net periodic benefit (credit) cost:
Service cost$26 $19 $25 $17 $27 $14 $— $— $— 
Interest cost37 12 57 15 76 20 12 19 25 
Expected return on plan assets(126)(37)(135)(34)(128)(32)(5)(5)(5)
Amortization of:
Prior service (credit) cost— (1)(1)— — (37)(38)(39)
Mark-to-market pension and other postretirement benefits loss (gain), net(170)(62)163 28 39 43 (35)49 61 
Net periodic benefit (credit) cost$(233)$(69)$111 $25 $14 $45 $(65)$25 $42 
Other changes in plan assets and benefit obligations recognized in other comprehensive income:
Current year prior service credit (cost)$— $— $— $12 $— $— $— $— $— 
Amortization of:
Prior service (credit) cost— (1)(1)— — (37)(38)(39)
Total$— $(1)$$11 $— $— $(37)$(38)$(39)
Schedule of Assumptions Used to Develop the Projected Benefit Obligation The assumptions used to develop the projected benefit obligation for Eastman's significant U.S. and non-U.S. defined benefit pension plans and U.S. postretirement benefit plans are provided in the following tables.
Pension PlansPostretirement Benefit Plans
202120202019202120202019
Weighted-average assumptions used to determine benefit obligations for years ended December 31:
U.S.Non-U.S.U.S.Non-U.S.U.S.Non-U.S.
Discount rate2.88 %1.57 %2.48 %1.08 %3.25 %1.56 %2.83 %2.38 %3.21 %
Interest crediting rate5.50 %N/A5.50 %N/A5.52 %N/AN/AN/AN/A
Rate of compensation increase3.00 %3.00 %2.75 %2.94 %3.25 %2.94 %N/AN/A3.25 %
Health care cost trend
Initial6.00 %6.25 %6.50 %
Decreasing to ultimate trend of5.00 %5.00 %5.00 %
in year202620262026
Weighted-average assumptions used to determine net periodic cost for years ended December 31:
U.S.Non-U.S.U.S.Non-U.S.U.S.Non-U.S.
Discount rate2.48 %1.08 %3.25 %1.56 %4.29 %2.35 %2.39 %3.21 %4.26 %
Discount rate for service cost2.57 %1.08 %3.31 %1.56 %4.32 %2.35 %1.90 %2.92 %4.05 %
Discount rate for interest cost1.79 %1.08 %2.83 %1.56 %3.96 %2.35 %1.74 %2.80 %3.93 %
Expected return on assets7.29 %4.04 %7.37 %4.26 %7.43 %4.49 %3.75 %3.75 %3.75 %
Rate of compensation increase2.75 %2.94 %3.25 %2.94 %3.25 %2.94 %N/A3.25 %3.25 %
Interest crediting rate5.50 %N/A5.52 %N/A5.54 %N/AN/AN/AN/A
Health care cost trend
Initial6.25 %6.50 %6.50 %
Decreasing to ultimate trend of5.00 %5.00 %5.00 %
in year202620262025
Schedule of Fair Value Measurements of Pension Plan Assets on a Recurring Basis
The following tables reflect the fair value of the defined benefit pension plans assets.
(Dollars in millions)Fair Value Measurements at December 31, 2021
DescriptionTotal Fair ValueQuoted Prices in Active Markets for Identical Assets (Level 1)Significant Other Observable Inputs (Level 2)Significant Unobservable Inputs
(Level 3)
Pension Assets:U.S.Non-U.S.U.S.Non-U.S.U.S.Non-U.S.U.S.Non-U.S.
Cash and Cash Equivalents (1)
$45 $37 $45 $37 $— $— $— $— 
Public Equity - United States (2)
— — — — — — 
Other Investments (3)
— 59 — — — — — 59 
Total Assets at Fair Value$48 $96 $48 $37 $— $— $— $59 
Investments Measured at Net Asset Value (4)
1,829 828 
Total Assets$1,877 $924 
(Dollars in millions)Fair Value Measurements at December 31, 2020
DescriptionTotal Fair ValueQuoted Prices in Active Markets for Identical Assets (Level 1)Significant Other Observable Inputs (Level 2)Significant Unobservable Inputs
(Level 3)
Pension Assets:U.S.Non-U.S.U.S.Non-U.S.U.S.Non-U.S.U.S.Non-U.S.
Cash and Cash Equivalents (1)
$47 $103 $47 $103 $— $— $— $— 
Public Equity - United States (2)
— — — — — — 
Other Investments (3)
— 68 — — — — — 68 
Total Assets at Fair Value$48 $171 $48 $103 $— $— $— $68 
Investments Measured at Net Asset Value (4)
1,750 767 
Total Assets$1,798 $938 
(1)Cash and Cash Equivalents: Funds generally invested in actively managed collective trust funds or interest bearing accounts.
(2)Public Equity - United States: Common stock equity securities which are primarily valued using a market approach based on the quoted market prices.
(3)Other Investments: Primarily consist of insurance contracts which are generally valued using a crediting rate that approximates market returns and investments in underlying securities whose market values are unobservable and determined using pricing models, discounted cash flow methodologies, or similar techniques.
(4)Investments Measured at Net Asset Value: The underlying debt, public equity, and public real asset investments in this category are generally held in common trust funds, which are either actively or passively managed investment vehicles, that are valued at the net asset value per unit/share multiplied by the number of units/shares held as of the measurement date. The other alternative investments in this category are valued under the practical expedient method which is based on the most recently reported net asset value provided by the management of each private investment fund, adjusted as appropriate, for any lag between the date of the financial reports and the measurement date.
The following tables reflect the fair value of the postretirement benefit plan assets. The postretirement benefit plan is for the voluntary employees' beneficiary association ("VEBA") trust the Company assumed as part of the Solutia acquisition.
(Dollars in millions)Fair Value Measurements at
 December 31, 2021
DescriptionTotal Fair ValueQuoted Prices in Active Markets for Identical Assets
(Level 1)
Significant Other Observable Inputs
(Level 2)
Significant Unobservable Inputs
(Level 3)
Postretirement Benefit Plan Assets:
Cash and Cash Equivalents (1)
$— $— $— $— 
Debt (2):
Fixed Income (U.S.)79 — 79 — 
Fixed Income (Non-U.S.)29 — 29 — 
Total$108 $— $108 $— 
(Dollars in millions)Fair Value Measurements at
 December 31, 2020
DescriptionTotal Fair ValueQuoted Prices in Active Markets for Identical Assets
(Level 1)
Significant Other Observable Inputs
(Level 2)
Significant Unobservable Inputs
(Level 3)
Postretirement Benefit Plan Assets:
Cash & Cash Equivalents (1)
$$$— $— 
Debt (2):
Fixed Income (U.S.)89 — 89 — 
Fixed Income (Non-U.S.)25 — 25 — 
Total$115 $$114 $— 
(1)Cash and Cash Equivalents: Funds generally invested in actively managed collective trust funds or interest bearing accounts.
(2)Debt: The fixed income securities are primarily valued upon a market approach, using matrix pricing and considering a security's relationship to other securities for which quoted prices in an active market may be available, or an income approach, converting future cash flows to a single present value amount. Inputs used in developing fair value estimates include reported trades, broker quotes, benchmark yields, and base spreads.
Schedule of Pension Plan Assets Classified within Level 3 of the Fair Value Hierarchy
The Company valued assets with unobservable inputs (Level 3), primarily insurance contracts, using a crediting rate that approximates market returns and investments in underlying securities whose market values are unobservable and determined using pricing models, discounted cash flow methodologies, or similar techniques.
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
Other Investments(1)
(Dollars in millions)Non-U.S. Pension Plans
Balance at December 31, 2019$57 
Unrealized gains
Purchases, issuances, sales, and settlements
Balance at December 31, 202068 
Unrealized losses(9)
Balance at December 31, 2021$59 
(1)Primarily consists of insurance contracts.
Schedule of US and Non-US Pension Plans Asset Target Allocation by Category
The following table reflects the target allocation for the Company's U.S. and non-U.S. pension and postretirement benefit plans assets for 2022 and the asset allocation at December 31, 2021 and 2020, by asset category.
U.S. Pension PlansNon-U.S. Pension PlansPostretirement Benefit Plan
2022 Target AllocationPlan Assets at
December 31, 2021
Plan Assets at
December 31, 2020
2022 Target AllocationPlan Assets at
December 31, 2021
Plan Assets at
December 31, 2020
2022 Target AllocationPlan Assets at
December 31, 2021
Plan Assets at
December 31, 2020
Asset category
Equity securities39%38%39%23%22%20%—%—%—%
Debt securities42%43%43%59%59%57%100%100%100%
Real estate3%3%2%4%4%6%—%—%—%
Other investments (1)
16%16%16%14%15%17%—%—%—%
Total100%100%100%100%100%100%100%100%100%
(1)U.S. primarily consists of private equity and natural resource and energy related limited partnership investments and public real assets. Non-U.S. primarily consists of annuity contracts and alternative investments.
Schedule Benefits Expected to be Paid from Pension Plans and Benefits The estimated future benefit payments, reflecting expected future service, as appropriate, are as follows:
Pension PlansPostretirement 
Benefit Plans
(Dollars in millions)U.S.Non-U.S.
2022$132 $30 $46 
2023142 35 47 
2024135 34 47 
2025132 35 46 
2026134 38 46 
2027-2031634 222 214