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RETIREMENT PLANS
 12 Months Ended
Dec. 31, 2022
Retirement Benefits [Abstract]  
RETIREMENT PLANS RETIREMENT PLANS
As described below, Eastman offers various postretirement benefits to its employees.

Defined Contribution Plans

Eastman sponsors a defined contribution employee stock ownership plan (the "ESOP"), which is a component of the Eastman Investment Plan and Employee Stock Ownership Plan ("EIP/ESOP"), under Section 401(a) of the Internal Revenue Code. Eastman made a contribution in February 2023 to the EIP/ESOP for substantially all U.S. employees equal to 5 percent of their eligible compensation for the 2022 plan year. Employees may allocate contributions to other investment funds within the EIP from the ESOP at any time without restrictions. Allocated shares in the ESOP totaled 1,871,624; 1,909,362; and 1,997,587 shares as of December 31, 2022, 2021, and 2020, respectively. Dividends on shares held by the EIP/ESOP are charged to retained earnings. All shares held by the EIP/ESOP are treated as outstanding in computing earnings per share ("EPS").

In 2006, the Company amended its EIP/ESOP to provide a Company match of 50 percent of the first 7 percent of an employee's compensation contributed to the plan for employees who are hired on or after January 1, 2007. Employees who are hired on or after January 1, 2007, are also eligible for the contribution to the ESOP as described above.

Charges for domestic contributions to the EIP/ESOP were $81 million, $73 million, and $67 million for 2022, 2021, and 2020, respectively.

Defined Benefit Pension Plans and Other Postretirement Benefit Plans

Pension Plans

Eastman maintains defined benefit pension plans that provide eligible employees with retirement benefits.

Effective January 1, 2000, the Company's Eastman Retirement Assistance Plan, a U.S. defined benefit pension plan, was amended. Employees' accrued pension benefits earned prior to January 1, 2000 are calculated based on previous plan provisions using the employee's age, years of service, and final average compensation as defined in the plans. The amended plan uses a pension equity formula to calculate an employee's retirement benefits from January 1, 2000 forward. Benefits payable will be the combined pre-2000 and post-1999 benefits. Employees hired on or after January 1, 2007 are not eligible to participate in Eastman's U.S. defined benefit pension plans.

Benefits are paid to employees from trust funds. Contributions to the trust funds are made as permitted by laws and regulations. The pension trust funds do not directly own any of the Company's common stock.

Pension coverage for employees of Eastman's non-U.S. operations is provided, to the extent deemed appropriate, through separate plans. The Company systematically provides for obligations under such plans by depositing funds with trustees, under insurance policies, or by book reserves.

Other Postretirement Benefit Plans

Under its other postretirement benefit plans in the U.S., Eastman provides life insurance for eligible retirees hired prior to January 1, 2007. Eastman provided a subsidy for pre-Medicare health care and dental benefits to eligible retirees hired prior to January 1, 2007 that ended on December 31, 2021. Company funding is also provided for eligible Medicare retirees hired prior to January 1, 2007 with a health reimbursement arrangement. A few of the Company's non-U.S. operations have supplemental health benefit plans for certain retirees, the cost of which is not significant to the Company.
Below is a summary balance sheet of the change in plan assets during 2022 and 2021, the funded status of the plans and amounts recognized in the Consolidated Statements of Financial Position.

Summary of Changes
Pension Plans
Postretirement Benefit Plans
2022202120222021
(Dollars in millions)U.S.Non-U.S.U.S.Non-U.S.
Change in projected benefit obligation:
Benefit obligation, beginning of year$1,892 $948 $2,050 $1,089 $665 $745 
Service cost25 11 26 19 — — 
Interest cost45 14 37 12 14 12 
Actuarial gain(328)(264)(49)(68)(127)(40)
Curtailment gain— (3)— — — — 
Settlement(9)— (6)— — — 
Divestitures— — — (32)— (2)
Plan participants' contributions— 1 — 1 2 9 
Effect of currency exchange— (77)— (43)— — 
Federal subsidy on benefits paid— — — — — 1 
Benefits paid(154)(28)(166)(30)(45)(60)
Benefit obligation, end of year$1,471 $602 $1,892 $948 $509 $665 
Change in plan assets:
Fair value of plan assets, beginning of year$1,877 $924 $1,798 $938 $134 $144 
Actual return on plan assets(312)(250)247 31 (31)7 
Effect of currency exchange— (76)— (39)— — 
Company contributions3 18 4 23 35 40 
Reserve for third party contributions— — — — 11 (7)
Plan participants' contributions— 1 — 1 2 9 
Benefits paid(154)(28)(166)(30)(45)(60)
Federal subsidy on benefits paid— — — — — 1 
Settlements(9)— (6)— — — 
Fair value of plan assets, end of year$1,405 $589 $1,877 $924 $106 $134 
Funded status at end of year$(66)$(13)$(15)$(24)$(403)$(531)
Amounts recognized in the Consolidated Statements of Financial Position consist of:
Other noncurrent assets$— $23 $41 $42 $53 $62 
Current liabilities(13)— (3)— (38)(38)
Post-employment obligations(53)(36)(53)(66)(418)(555)
Net amount recognized, end of year$(66)$(13)$(15)$(24)$(403)$(531)
Accumulated benefit obligation$1,417 $578 $1,803 $910 
Amounts recognized in accumulated other comprehensive income consist of:
Prior service (credit) cost$— $(6)$1 $(10)$(37)$(68)

Actuarial gains in the projected benefit obligations for 2022 were primarily due to higher discount rates partially offset by changes in actuarial assumptions. Actuarial gains in the projected benefit obligations for 2021 were primarily due to higher discount rates.
Information for pension plans with projected benefit obligations in excess of plan assets:
(Dollars in millions)20222021
U.S.Non-U.S.U.S.Non-U.S.
Projected benefit obligation$1,471 $176 $175 $288 
Fair value of plan assets1,405 140 119 222 

Information for pension plans with accumulated benefit obligations in excess of plan assets:
(Dollars in millions)20222021
U.S.Non-U.S.U.S.Non-U.S.
Accumulated benefit obligation$245 $141 $161 $272 
Fair value of plan assets188 116 119 222 

Postretirement benefit plans with accumulated benefit obligations in excess of plan assets are $456 million and $592 million at December 31, 2022 and 2021, respectively. The plans have no assets.

Summary of Benefit Costs and Other Amounts Recognized in Other Comprehensive Income
 Pension PlansPostretirement Benefit Plans
202220212020202220212020
(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$25 $11 $26 $19 $25 $17 $— $— $— 
Interest cost45 14 37 12 57 15 14 12 19 
Expected return on plan assets(128)(31)(126)(37)(135)(34)(4)(5)(5)
Amortization of:
Prior service (credit) cost1 — — (1)1 (1)(31)(37)(38)
Mark-to-market pension and other postretirement benefits loss (gain), net (1)
112 10 (170)(62)163 28 (103)(35)49 
Net periodic benefit (credit) cost$55 $4 $(233)$(69)$111 $25 $(124)$(65)$25 
Other changes in plan assets and benefit obligations recognized in other comprehensive income:
Curtailment gain $— $(4)$— $— $— $— $— $— $— 
Current year prior service credit (cost)— — — — — 12 — — — 
Amortization of:
Prior service (credit) cost1 — — (1)1 (1)(31)(37)(38)
Total$1 $(4)$— $(1)$1 $11 $(31)$(37)$(38)

(1)Includes curtailment triggered by the sale of the adhesives resins business which is included in "Other components of postemployment net" on the Consolidated Statements of Earnings, Comprehensive Income and Retained Earnings.

Subsequent to the adhesives resins divestiture, the Company retained pension liabilities of certain plan participants while the
status of the participants changed in a Non-U.S. pension plan which triggered a curtailment and an interim mark-to-market
("MTM") remeasurement of the impacted Non-U.S. pension plan's assets and liabilities. A curtailment gain of $7 million, including $3 million reduction in the pension benefit obligation and $4 million of prior service credits recognized immediately, and a MTM gain of $3 million were recognized in 2022.
Settlements are triggered in a plan when distributions exceed the sum of service cost and interest cost of the respective plan. Lump sum payments from a U.S. pension plan resulted in a plan settlement in second quarter 2022. The settlement was not material. However, the settlement triggered an interim remeasurement of the impacted U.S. pension plan's assets and liabilities and, as such, the Company recognized a MTM loss of $7 million in 2022.

Plan Assumptions

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
202220212020202220212020
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 rate5.58 %4.27 %2.88 %1.57 %2.48 %1.08 %5.55 %2.83 %2.38 %
Interest crediting rate5.48 %N/A5.50 %N/A5.50 %N/AN/AN/AN/A
Rate of compensation increase3.00 %3.04 %3.00 %3.00 %2.75 %2.94 %N/AN/AN/A
Health care cost trend
Initial6.00 %6.00 %6.25 %
Decreasing to ultimate trend of5.00 %5.00 %5.00 %
in year203020262026
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 rate2.88 %1.57 %2.48 %1.08 %3.25 %1.56 %2.83 %2.39 %3.21 %
Discount rate for service cost2.95 %1.31 %2.57 %1.08 %3.31 %1.56 %N/A1.90 %2.92 %
Discount rate for interest cost2.46 %1.57 %1.79 %1.08 %2.83 %1.56 %2.35 %1.74 %2.80 %
Expected return on assets7.07 %3.81 %7.29 %4.04 %7.37 %4.26 %3.50 %3.75 %3.75 %
Rate of compensation increase3.00 %3.00 %2.75 %2.94 %3.25 %2.94 %N/AN/A3.25 %
Interest crediting rate5.50 %N/A5.50 %N/A5.52 %N/AN/AN/AN/A
Health care cost trend
Initial6.00 %6.25 %6.50 %
Decreasing to ultimate trend of5.00 %5.00 %5.00 %
in year202620262026

The Company calculates service and interest cost components of net periodic benefit costs for its significant defined benefit pension and other postretirement benefit plans by applying the specific spot rates along the yield curve to the plans' projected cash flows.

The fair value of plan assets for the U.S. pension plans at December 31, 2022 and 2021 was $1.4 billion and $1.9 billion, respectively, while the fair value of plan assets at December 31, 2022 and 2021 for non-U.S. pension plans was $589 million and $924 million, respectively. At December 31, 2022 and 2021, the expected weighted-average long-term rate of return on U.S. pension plan assets was 6.62 percent and 7.07 percent, respectively. The expected weighted-average long-term rate of return on non-U.S. pension plans assets was 3.86 percent and 3.81 percent at December 31, 2022 and 2021, respectively.
Plan Assets

The following tables reflect the fair value of the defined benefit pension plans assets.
(Dollars in millions)Fair Value Measurements at December 31, 2022
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)
$27 $46 $27 $46 $— $— $— $— 
Public Equity - United States (2)
4 — 4 — — — — — 
Other Investments (3)
— 45 — — — — — 45 
Total Assets at Fair Value$31 $91 $31 $46 $— $— $— $45 
Investments Measured at Net Asset Value (4)
1,374 498 
Total Assets$1,405 $589 
(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)
3 — 3 — — — — — 
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 
(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, 2022
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)
$5 $5 $— $— 
Debt (2):
Fixed Income (U.S.)62 — 62 — 
Fixed Income (Non-U.S.)21 — 21 — 
Total$88 $5 $83 $— 
(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 $— 
(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.

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, 2020$68 
Unrealized losses(9)
Balance at December 31, 202159 
Unrealized losses(14)
Balance at December 31, 2022$45 
(1)Primarily consists of insurance contracts.
The following table reflects the target allocation for the Company's U.S. and non-U.S. pension and postretirement benefit plans assets for 2023 and the asset allocation at December 31, 2022 and 2021, by asset category.
U.S. Pension PlansNon-U.S. Pension PlansPostretirement Benefit Plan
2023 Target AllocationPlan Assets at
December 31, 2022		Plan Assets at
December 31, 2021		2023 Target AllocationPlan Assets at
December 31, 2022		Plan Assets at
December 31, 2021		2023 Target AllocationPlan Assets at
December 31, 2022		Plan Assets at
December 31, 2021
Asset category
Equity securities39%36%38%21%20%22%—%—%—%
Debt securities38%39%43%60%62%59%100%100%100%
Real estate8%7%3%4%4%4%—%—%—%
Other investments (1)
15%18%16%15%14%15%—%—%—%
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.

Investment Strategy

Eastman's investment strategy for its defined benefit pension plans is to maximize the long-term rate of return on plan assets within an acceptable level of risk in order to meet or exceed the plan's actuarially assumed long-term rate of return and to minimize the cost of providing pension benefits. A periodic asset/liability study is conducted in order to assist in the determination and, if necessary, modification of the appropriate long-term investment policy for the plan. The investment policy establishes a target allocation range for each asset class and the fund is managed within those ranges. The plans use a number of investment approaches including investments in equity, real estate, and fixed income funds in which the underlying securities are marketable in order to achieve this target allocation. The plans also invest in private equity and other funds. Diversification is created through investments across various asset classes, geographies, fund managers, and individual securities. This investment process is designed to provide for a well-diversified portfolio with no significant concentration of risk. The investment process is monitored by an investment committee that includes senior management.

Eastman's investment strategy for its VEBA trust is to invest in intermediate-term, well diversified, high quality investment instruments, with a primary objective of capital preservation.

The expected rate of return for all plans was determined primarily by modeling the expected long-term rates of return for the categories of investments held by the plans and the targeted allocation percentage against various potential economic scenarios.

The Company made no contributions to its U.S. defined benefit pension plans in 2022 or 2021. For 2023 calendar year, there are no minimum required cash contributions for the U.S. defined benefit pension plans under the Employee Retirement Income Security Act of 1974, as amended, and the Internal Revenue Code of 1986, as amended.

Benefit payments are made using a combination of plan assets and cash payments. Most of the Company's pension plans have plan assets that predominately cover pension benefit obligations. 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.
2023$230 $28 $47 
2024123 26 47 
2025122 28 47 
2026121 31 46 
2027126 35 45 
2028-2032604 187 208