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Retirement Plans | 12 Months Ended
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Dec. 31, 2022
Postemployment Benefits [Abstract] |
Retirement Plans | Retirement Plans Defined Contribution Plans Eligible employees may participate in our retirement savings plan ("Plan"), a qualified salary-reduction plan under Section 401(k) of the U.S. Internal Revenue Code by contributing a portion of their compensation. For non-union eligible employees participating in the Plan, Ingevity makes matching contributions up to six percent of the employee deferral. In addition to the matching contributions, Ingevity also makes a non-elective contribution of three percent of eligible compensation per payroll for non-union employees. For eligible union employees participating in the Plan, Ingevity makes matching contributions up to 100 percent of the first three percent of the employee deferrals and 50 percent on the next two percent of deferrals. Employee contributions, as well as Ingevity’s match contributions, are made to funds designated by the participant, none of which are based on Ingevity’s common stock. Charges associated with employer contributions to the Plan were $11.2 million, $9.5 million, and $10.6 million for the years ended December 31, 2022, 2021, and 2020, respectively. Defined Benefit Pension and Postretirement Plans Ingevity has both established qualified and non-qualified benefit plans to provide pension and post-retirement benefits to certain employees and retirees. Our retirement obligations consist of accrued defined benefit obligations earned by Ingevity domestic hourly union employees; accrued obligations from a frozen non-qualified defined benefit pension plan for certain salaried and former salaried employees of Ingevity; and other post-retirement medical and life insurance benefits. We are required to recognize on our consolidated balance sheets the overfunded and underfunded status of our defined benefit postretirement plans. The overfunded and underfunded status is defined as the difference between the fair value of plan assets and the projected benefit obligation. We are also required to recognize, as a component of other comprehensive income, the actuarial gains and losses and the prior service costs and credits that arise during the period. The following tables summarize the weighted average assumptions used and components of our defined benefit postretirement plans at December 31, 2022 and 2021.
| Pensions |  | Other Benefits
| December 31,
In millions, except percentages | 2022 |  | 2021 |  | 2022 |  | 2021
Following are the weighted average assumptions used to determine the benefit obligations at December 31: |  |  |  |  |  |  |
Discount rate - qualified benefit plans | 5.00 | % |  | 2.75 | % |  | — | % |  | — | %
Discount rate - non-qualified benefit plans | 5.00 | % |  | 2.65 | % |  | 4.90 | % |  | 2.60 | %
Rate of compensation increase | N/A |  | N/A |  | N/A |  | N/A
Change in projected benefit obligation |  |  |  |  |  |  |
Projected benefit obligation at January 1 | $ | 45.0 |  |  | $ | 45.0 |  |  | $ | 0.9 |  |  | $ | 1.0 |
Service cost | 1.5 |  |  | 1.7 |  |  | — |  |  | — |
Interest cost | 1.2 |  |  | 1.1 |  |  | — |  |  | — |
Actuarial loss (gain) | (14.2) |  |  | (2.1) |  |  | (0.1) |  |  | (0.1) |
Plan amendments | 0.5 |  |  | 0.3 |  |  | (0.1) |  |  | — |
Benefit payments | (1.2) |  |  | (1.0) |  |  | — |  |  | — |
Projected benefit obligation at December 31 (1) | 32.8 |  |  | 45.0 |  |  | 0.7 |  |  | 0.9 |
Change in plan assets |  |  |  |  |  |  |
Fair value of plan asset at January 1 | 31.8 |  |  | 31.2 |  |  | — |  |  | — |
Actual return on plan assets | (7.8) |  |  | 1.4 |  |  | — |  |  | — |
Company contributions | 0.3 |  |  | 0.2 |  |  | — |  |  | — |
Benefit payments | (1.2) |  |  | (1.0) |  |  | — |  |  | — |
Fair value of plan assets at December 31 | 23.1 |  |  | 31.8 |  |  | — |  |  | — |
Funded Status |  |  |  |  |  |  |
Net Funded Status of the Plan (Liability) | $ | (9.7) |  |  | $ | (13.2) |  |  | $ | (0.7) |  |  | $ | (0.9) |
| Pensions |  | Other Benefits
| December 31,
In millions | 2022 |  | 2021 |  | 2022 |  | 2021
Amount recognized on the consolidated balance sheets: |  |  |  |  |  |  |
Pension and other postretirement benefit asset (2) | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Pension and other postretirement benefit (liability) (2) | (9.7) |  |  | (13.2) |  |  | (0.7) |  |  | (0.9) |
Total Net Funded Status of the Plan (Liability) | $ | (9.7) |  |  | $ | (13.2) |  |  | $ | (0.7) |  |  | $ | (0.9) |
_______________ (1) The accumulated benefit obligation for all years presented equals the projected benefit obligation for each plan, respectively. (2) Asset balance is included within "Other assets" and liability balances are included within "Other liabilities" on the consolidated balance sheet. Amounts Recognized in Other Comprehensive Income (Loss) Changes in plan assets and benefit obligations recognized in other comprehensive income (loss) are as follows:
| Years Ended December 31,
| Pensions |  | Other Benefits |  | Total
In millions | 2022 |  | 2021 |  | 2020 |  | 2022 |  | 2021 |  | 2020 |  | 2022 |  | 2021 |  | 2020
Current year net actuarial loss (gain) | $ | (4.7) |  |  | $ | (2.1) |  |  | $ | 2.3 |  |  | $ | (0.1) |  |  | $ | (0.1) |  |  | $ | 0.1 |  |  | $ | (4.8) |  |  | $ | (2.2) |  |  | $ | 2.4 |
Current year prior service cost (credit) | 0.5 |  |  | 0.3 |  |  | 0.3 |  |  | (0.1) |  |  | — |  |  | — |  |  | 0.4 |  |  | 0.3 |  |  | 0.3 |
Amortization of net actuarial (loss) gain and prior service (cost) credit | (0.1) |  |  | (0.2) |  |  | (0.2) |  |  | — |  |  | — |  |  | — |  |  | (0.1) |  |  | (0.2) |  |  | (0.2) |
Settlement and curtailment (charges) income, net | (0.2) |  |  | — |  |  | (0.1) |  |  | — |  |  | — |  |  | — |  |  | (0.2) |  |  | — |  |  | (0.1) |
Total recognized in other comprehensive (income) loss, before taxes | (4.5) |  |  | (2.0) |  |  | 2.3 |  |  | (0.2) |  |  | (0.1) |  |  | 0.1 |  |  | (4.7) |  |  | (2.1) |  |  | 2.4 |
Total recognized in other comprehensive (income) loss, after taxes | $ | (3.4) |  |  | $ | (1.5) |  |  | $ | 1.7 |  |  | $ | (0.2) |  |  | $ | (0.1) |  |  | $ | 0.1 |  |  | $ | (3.6) |  |  | $ | (1.6) |  |  | $ | 1.8 |
Amounts Recognized in Accumulated Other Comprehensive Income (Loss) The amounts in accumulated other comprehensive income (loss) that have not yet been recognized as components of net periodic benefit cost are as follows:
| December 31,
| Pensions |  | Other Benefits |  | Total
In millions | 2022 |  | 2021 |  | 2022 |  | 2021 |  | 2022 |  | 2021
Net actuarial (gain) loss | $ | (1.6) |  |  | $ | 3.1 |  |  | $ | (0.1) |  |  | $ | 0.1 |  |  | $ | (1.7) |  |  | $ | 3.2 |
Prior service cost (credit) | 1.3 |  |  | 1.0 |  |  | (0.1) |  |  | — |  |  | 1.2 |  |  | 1.0 |
Accumulated other comprehensive (income) loss, before taxes | (0.3) |  |  | 4.1 |  |  | (0.2) |  |  | 0.1 |  |  | (0.5) |  |  | 4.2 |
Accumulated other comprehensive (income) loss, after taxes | $ | (0.2) |  |  | $ | 3.1 |  |  | $ | (0.2) |  |  | $ | 0.1 |  |  | $ | (0.4) |  |  | $ | 3.2 |
Net Annual Benefit Costs Assumptions The following table summarizes the weighted-average assumptions used for the components of net annual benefit cost:
| Years Ended December 31,
| Pensions |  | Other Benefits
In millions, except percentages | 2022 |  | 2021 |  | 2020 |  | 2022 |  | 2021 |  | 2020
Discount rate - qualified benefit plans (1) | 2.75 | % |  | 2.45 | % |  | 3.15 | % |  | — | % |  | — | % |  | — | %
Discount rate - non-qualified benefit plans (1) | 2.65 | % |  | 2.30 | % |  | 3.10 | % |  | 2.60 | % |  | 2.20 | % |  | 3.05 | %
Expected return on plan assets | 5.50 | % |  | 4.50 | % |  | 4.50 | % |  | N/A |  | N/A |  | N/A
Components of net annual benefit cost: |  |  |  |  |  |  |  |  |  |  |
Service cost (2) | $ | 1.5 |  |  | $ | 1.7 |  |  | $ | 1.6 |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Interest cost (3) | 1.2 |  |  | 1.1 |  |  | 1.2 |  |  | — |  |  | — |  |  | — |
Expected return on plan assets (3) | (1.7) |  |  | (1.4) |  |  | (1.2) |  |  | — |  |  | — |  |  | — |
Amortization of prior service cost (2) | 0.2 |  |  | 0.1 |  |  | 0.1 |  |  | — |  |  | — |  |  | — |
Amortization of net actuarial and other (gain) loss (3) | — |  |  | 0.1 |  |  | 0.1 |  |  | — |  |  | — |  |  | — |
Recognized (gain) loss due to curtailments (4) | 0.2 |  |  | — |  |  | 0.1 |  |  | — |  |  | — |  |  | — |
Net annual benefit cost | $ | 1.4 |  |  | $ | 1.6 |  |  | $ | 1.9 |  |  | $ | — |  |  | $ | — |  |  | $ | — |
_______________ (1) The discount rate used to calculate pension and other post-retirement obligations was based on a review of available yields on high-quality corporate bonds. In selecting a discount rate, we placed particular emphasis on a discount rate yield-curve provided by our third-party actuary, which takes into consideration the projected cash flows that represent the expected timing and amount of our plans' benefit payments. (2) Amounts are recorded to "Cost of sales" on our consolidated statements of operations consistent with the employee compensation costs that participate in the plan. (3) Amounts are recorded to "Other (income) expense, net" on our consolidated statements of operations. (4) Our pension and postretirement settlement and curtailment (income) charges are related to the acceleration of prior service costs as a result of a reduction in the number of participants within the Union Hourly defined benefit pension plan during 2022 and 2020. Contributions We made no voluntary cash contributions to our domestic hourly union defined benefit pension plan in the years ended December 31, 2022, 2021, and 2020. There are no required cash contributions to our domestic hourly union defined benefit pension plan in fiscal 2022, and we currently have no plans to make any voluntary cash contributions in fiscal 2022. Fair Value Hierarchy Following is a description of the valuation methodologies used for the investment measure at fair value. See Note 5 for the definition of fair value and the descriptions of Level 1, 2, and 3 in the fair value hierarchy. •Cash and short-term funds — Cash and quoted short-term instruments are valued at the closing price or the amount held on deposit by the custodian bank. •Mutual Funds — Mutual funds are valued at the closing price reported on the major market on which the individual securities are traded. Substantially all mutual funds are classified within Level 1 of the valuation hierarchy. •Pooled Funds — These investment vehicles are valued using the Net Asset Value (NAV) provided by the fund administrator. The NAV is based on the value of the underlying assets owned by the fund, minus its liabilities, and then divided by the number of shares outstanding. •Other — Other assets are represented by investments in a series limited partnership. These assets are not actively traded and are classified as Level 2. The following table presents our fair value hierarchy for our major categories of pension plan assets by asset class.
In millions | December 31, 2022 |  | Level 1 |  | Level 2 |  | Level 3 |  | Investments Measured at Net Asset Value
Cash and short-term investments | $ | 0.2 |  |  | $ | 0.2 |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Mutual funds | 6.7 |  |  | 6.7 |  |  | — |  |  | — |  |  | — |
Pooled funds | 14.5 |  |  | — |  |  | — |  |  | — |  |  | 14.5 |
Other | 1.7 |  |  | — |  |  | 1.7 |  |  | — |  |  | — |
Total assets | $ | 23.1 |  |  | $ | 6.9 |  |  | $ | 1.7 |  |  | $ | — |  |  | $ | 14.5 |
In millions | December 31, 2021 |  | Level 1 |  | Level 2 |  | Level 3 |  | Investments Measured at Net Asset Value
Cash and short-term investments | $ | 0.2 |  |  | $ | 0.2 |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Mutual funds | 9.2 |  |  | 9.2 |  |  | — |  |  | — |  |  | — |
Pooled funds | 20.3 |  |  | — |  |  | — |  |  | — |  |  | 20.3 |
Other | 2.1 |  |  | — |  |  | 2.1 |  |  | — |  |  | — |
Total assets | $ | 31.8 |  |  | $ | 9.4 |  |  | $ | 2.1 |  |  | $ | — |  |  | $ | 20.3 |
Estimated Future Benefit Payments The following table reflects the estimated future benefit payments for our pension and other postretirement benefit plans. These estimates take into consideration expected future service, as appropriate.
In millions | Pensions |  | Other Benefits
2023 | $ | 1.1 |  |  | $ | — |
2024 | 1.2 |  |  | — |
2025 | 1.4 |  |  | — |
2026 | 1.5 |  |  | — |
2027 | 1.6 |  |  | — |
2028-2032 | 10.2 |  |  | 0.2 |
Sensitivity Analysis A one-half percent increase in the assumed discount rate would have decreased our qualified pension benefit obligations by $2.0 million at December 31, 2022 and decreased our qualified pension benefit costs by $(0.1) million for 2022. A one-half percent decrease in the assumed discount rate would have increased our qualified pension obligations by $2.2 million at December 31, 2022 and increased our qualified pension benefit cost by $0.2 million for 2022. A one-half percent increase in the assumed expected long-term rate of return on plan assets would have decreased our qualified pension costs by $0.2 million for 2022. A one-half percent decrease in the assumed expected long-term rate of return on plan assets would have increased our qualified pension costs by $0.2 million for 2022.

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