v3.25.2
Retirement benefits (Tables)
12 Months Ended
Dec. 31, 2023
Employee Benefits [Abstract]  
Summary of Retirement Benefits by Financial Position
$ million
Dec 31, 2023Dec 31, 2022
Obligations(78,024)(73,481)
Plan assets79,96176,756
Asset ceilings(335)(371)
 Surplus
1,6022,904
Retirement benefits in the Consolidated Balance Sheet:
Non-current assets9,15110,200
Non-current liabilities:(7,549)(7,296)
Non-current liabilities - Pensions(4,448)(4,417)
Non-current liabilities - OPEB(3,101)(2,879)
Total1,6022,904
Summary of Retirement Benefit Expense
$ million
202320222021
Defined benefit plans:
Current service cost, net of plan participants' contributions7311,1001,385
Interest expense on defined pension benefit obligations3,0721,5841,223
Interest income on plan assets(3,417)(1,732)(1,160)
Interest expense on OPEB obligations166120128
Current OPEB service cost365760
Other [A]262246(343)
Total8501,3751,293
Defined contribution plans474420403
Total retirement benefit expense1,3241,7951,696
[A]Mainly related to plan amendments and curtailments on pension and OPEB plans.
Summary of Remeasurements
$ million
202320222021
Actuarial (losses)/gains on obligations:
Due to changes in financial assumptions on pensions [A](1,513)28,8401,915
Due to changes in financial assumptions on OPEB [A](264)52759
Due to experience adjustments on pensions [B](491)(2,956)136
Due to experience adjustments on OPEB [B]
2301,480
[C]
322
Due to changes in demographic assumptions on pensions [D](299)27(320)
Due to changes in demographic assumptions on OPEB [D](38)25(111)
Total(2,375)27,9432,001
Return on plan assets in excess/(shortage) of interest income
1,243(20,612)8,185
Other movements44(349)5
Total remeasurements(1,088)6,98210,191
[A]Mainly relates to changes in the discount rate and inflation assumptions.
[B]Experience adjustments arise from differences between the actuarial assumptions made in respect of the year and actual outcomes.
[C]Includes $782 million to reflect the impact of prescription drug rebates.
[D]Mainly relates to updates in mortality assumptions.
Summary of Defined Benefit Plan Obligations and Assets
Defined benefit plan obligations

2023
$ million, except where indicated
Pension benefitsOther post-employment benefits
The NetherlandsUK USA
Rest of the world
OPEB [A]
Total
At January 124,60817,79114,79313,4102,87973,481
Current service cost18414521517936759
Interest expense9048816955921663,238
Actuarial losses
929257832285722,375
Benefit payments(1,032)(1,014)(956)(757)(88)(3,847)
Other movements252(63)189
Currency translation differences9011,014(122)361,829
At December 3126,74619,07415,57913,524
[B]
3,10178,024
Comprising:
Funded pension plans26,74618,73414,69511,29871,473
Weighted average duration16 years15 years11 years13 years14 years
Unfunded pension plans3408842,2263,450
Weighted average duration16 years8 years11 years11 years
Unfunded OPEB plans3,1013,101
Weighted average duration13 years13 years
[A]Mainly related to post-retirement medical benefits in the USA.
[B]Rest of the world includes pension plans in Germany ($3,647 million) and Canada ($3,930 million) which are the largest pension plans in this category.
2022
$ million, except where indicated
Pension benefitsOther post-employment benefits
The NetherlandsUK USA
Rest of the world
OPEB [A]
Total
At January 135,34029,91319,00318,2134,867107,336
Current service cost286259282261571,145
Interest expense2984894173801201,704
Actuarial gains
(8,806)(9,793)(3,730)(3,582)(2,032)(27,943)
Benefit payments(942)(1,124)(1,088)(771)(178)(4,103)
Other movements374130(91)(154)37296
Currency translation differences(1,942)(2,083)(937)8(4,954)
At December 3124,60817,79114,79313,410
[B]
2,87973,481
Comprising:
Funded pension plans24,60817,47413,92511,25867,265
Weighted average duration17 years15 years12 years13 years15 years
Unfunded pension plans3178682,1523,337
Weighted average duration15 years9 years12 years11 years
Unfunded OPEB plans2,8792,879
Weighted average duration14 years14 years
[A]Mainly related to post-retirement medical benefits in the USA.
[B]Rest of the world includes pension plans in Germany ($3,477 million) and Canada ($3,482 million) which are the largest pension plans in this category.
23. Retirement benefits continued
Defined benefit plan assets

2023
$ million, except where indicated
Pension benefits
The NetherlandsUKUSA
Rest of the world
Total
At January 127,98621,96314,24312,56476,756
Return on plan assets in excess of interest income833(999)6098001,243
Interest income1,0351,0946796093,417
Employer contributions [A]
41934274(23)704
Plan participants' contributions1116734
Benefit payments(1,032)(1,014)(957)(703)(3,706)
Other movements(6)(16)(13)17(18)
Currency translation differences1,0201,242(731)1,531
At December 31 30,26622,32014,83512,540
[B]
79,961
[A]Includes the netted amount of $225 million received from the captive structure in relation to pension plans reinsured in Rest of the world.
[B]Rest of the world includes pension plans in Germany ($2,730 million) and Canada ($3,504 million) which are the largest pension plans in this category.
2022
$ million, except where indicated
Pension benefits
The NetherlandsUKUSA
Rest of the world
Total
At January 137,09633,72018,05515,624104,495
Return on plan assets in excess of interest income(6,576)(8,682)(3,523)(1,831)(20,612)
Interest income3145524064601,732
Employer contributions2285440841731
Plan participants' contributions1116532
Benefit payments(942)(1,124)(1,088)(735)(3,889)
Other movements(9)150(15)(184)(58)
Currency translation differences(2,136)(2,723)(816)(5,675)
At December 3127,98621,96314,24312,564
[A]
76,756
[A]Rest of the world includes pension plans in Germany ($2,538 million) and Canada ($3,497 million) which are the largest pension plans in this category.
Type of pension assets
20232022
Quoted in active markets:
Equities12%13%
Debt securities71%70%
Real estate1%—%
Other—%1%
Unquoted
Equities12%13%
Debt securities4%2%
Real estate
7%7%
Investment funds3%4%
Debt repurchase agreements [A](11)%(14)%
Cash1%4%
[A]Debt repurchase agreements are mainly related to UK member defined pension plans to fund liability-driven investments. In addition to these contracts, derivatives including interest rate and inflation swaps are used in the principal defined benefit plan in the Netherlands for liability matching strategies.
Summary of Assumptions for Sensitivity Analysis
$ million, except where indicated
Effect of using alternative assumptions
Assumptions used
at nominal rates
Increase/(decrease) in defined benefit obligations
Dec 31, 2023Dec 31, 2022Range
of assumptions
Dec 31, 2023Dec 31, 2022
Rate of increase in pensionable remuneration [A]3.9%4.0%
-1% to +1%
(828)915(833)921
of which the Netherlands3.3%3.3%
of which UK4.1%4.1%
of which USA4.6%4.6%
Rate of increase in pensions in payment1.9%2.1%
-1% to +1%
(5,599)6,713(5,542)6,657
of which the Netherlands2.4%2.6%
of which UK2.8%3.0%
of which USA—%—%
Discount rate for pension plans4.1%4.5%
-1% to +1%
10,560(8,472)10,522(8,328)
of which the Netherlands3.3%3.7%
of which UK4.6%4.8%
of which USA4.9%5.0%
Inflation rate for defined benefit obligation [B]2.0%2.2%
-1% to +1%
(6,034)7,300(6,002)7,271
of which the Netherlands2.4%2.6%
of which UK2.9%3.1%
Expected age at death for persons aged 60:
Men88 years87 years
-1 year to +1 year
(1,166)1,143(1,130)1,103
of which the Netherlands88 years88 years
of which UK87 years87 years
of which USA87 years85 years
Women89 years89 years
-1 year to +1 year
(1,006)1,041(993)1,077
of which the Netherlands90 years89 years
of which UK89 years90 years
of which USA89 years86 years
Rate of increase in health-care costs [C]7.0%6.4%
-1% to +1%
(338)422(298)372
Discount rate for health-care plans [C]5.6%5.7%
-1% to +1%
457(358)401(309)
[A]Based on active members.
[B]Excluding US funds in the weighted average inflation rate, because of the insignificant impact on the defined benefit obligation.
[C]Mainly related to post-retirement health-care benefits in the USA.