3M 2015 Annual Report Download - page 88

TableofContents
U.S. Pension Plans and Postretirement Benefit Plan Assets
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InordertoachievetheinvestmentobjectivesintheU.S.pensionplansandU.S.postretirementbenefitplans,theinvestmentpolicies
includeatargetstrategicassetallocation.Theinvestmentpoliciesallowsometolerancearoundthetargetinrecognitionthatmarket
fluctuationsandilliquidityofsomeinvestmentsmaycausetheallocationtoaspecificassetclasstovaryfromthetargetallocation,
potentiallyforlongperiodsoftime.Acceptablerangeshavebeendesignedtoallowfordeviationfromstrategictargetsandtoallow
fortheopportunityfortacticalover-andunder-weights.Theportfolioswillnormallyberebalancedwhenthequarter-endasset
allocationdeviatesfromacceptableranges.Theallocationisreviewedregularlybythenamedfiduciaryoftheplans.Approximately
39%ofthepostretirementbenefitplanassetsareina401(h)account.The401(h)accountassetsareinthesametrustastheprimary
U.S.pensionplanandinvestedwiththesameinvestmentobjectivesastheprimaryU.S.pensionplan.
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ThefairvaluesoftheassetsheldbytheU.S.pensionplansbyassetclassareasfollows:
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FairValueMeasurementsUsingInputsConsideredas FairValueat 
(Millions) Level1 Level2 Level3 Dec.31, 
AssetClass  2015  2014  2015  2014  2015  2014  2015  2014 
Equities                 
U.S.equities $ 1,897 $ 1,766 $ — $ — $ — $ — $ 1,897 $ 1,766 
Non-U.S.equities  1,149  1,214  —  —  —  —  1,149  1,214 
Indexandlong/shortequityfunds*        578  607 
TotalEquities $ 3,046 $ 2,980 $ — $ — $ — $— $ 3,624 $ 3,587 
FixedIncome                 
U.S.governmentsecurities $ 1,095 $ 1,032 $ 456 $ 590 $ — $ — $ 1,551 $ 1,622 
Non-U.S.governmentsecurities  —  7  126  381  —  —  126  388 
Preferredandconvertiblesecurities  4  6  8  9  —  —  12  15 
U.S.corporatebonds  9  8  2,820  2,889  —  —  2,829  2,897 
Non-U.S.corporatebonds  —  —  616  566  —  —  616  566 
Derivativeinstruments (1) 6  40  126  —  —  39  132 
Other*         11  32 
TotalFixedIncome $ 1,107 $ 1,059 $ 4,066 $ 4,561 $ — $— $ 5,184 $ 5,652 
PrivateEquity                 
Derivativeinstruments $ — $ — $ — $ — $(106)$(74)$(106)$(74)
Growthequity  24  15  —  —  —  —  24  15 
Partnershipinvestments*             2,450  2,561 
TotalPrivateEquity $ 24 $ 15 $ — $ — $(106)$(74)$ 2,368 $ 2,502 
AbsoluteReturn                 
Derivativeinstruments $ — $ — $(5)$ — $ — $ — $(5)$ — 
Fixedincomeandother   253   26   46   52   —   —   299   78 
Hedgefund/fundoffunds*             1,409  1,807 
Partnershipinvestments*             355  288 
TotalAbsoluteReturn $ 253 $ 26 $ 41 $ 52 $ — $— $ 2,058 $ 2,173 
CashandCashEquivalents                 
Cashandcashequivalents $ 102 $ 287 $ 6 $ 86 $ — $ — $ 108 $ 373 
Cashandcashequivalents,valuedatnetassetvalue*             783  531 
TotalCashandCashEquivalents $ 102 $ 287 $ 6 $ 86 $ — $ — $ 891 $ 904 
Total $ 4,532 $ 4,367 $ 4,113 $ 4,699 $(106)$(74)$ 14,125 $ 14,818 
Otheritemstoreconciletofairvalueofplanassets              $(159)$(175)
Fairvalueofplanassets              $ 13,966 $ 14,643 
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*InaccordancewithASC820-10,certaininvestmentsthataremeasuredatfairvalueusingthenetassetvalue(NAV)pershare(or
itsequivalent)asapracticalexpedienthavenotbeenclassifiedinthefairvaluehierarchy.TheNAVisbasedonthefairvalueofthe
underlyingassetsownedbythefund,minusitsliabilitiesthendividedbythenumberofunitsoutstandingandisdeterminedbythe
investmentmanagerorcustodianofthefund.Thefairvalueamountspresentedinthistableareintendedtopermitreconciliationof
thefairvaluehierarchytotheamountspresentedinthefairvalueofplanassets.
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