2020 Financial Statements

2. Notes to the IFRS Consolidated Financial Statements / 2.6 Employees Costs and Benefits Pension obligations sensitivity to main assumptions The following table shows how the present value of the DBO of retirement plans and deferred compensation would have been influenced by changes in the actuarial assumptions as set out for 31 December 2020: Change in actuarial assumptions Impact on DBO Change at 31 December 2020 2019 Present value of the DBO 23,148 21,013 Discount rate Increase by 0.5%-point (2,041) (1,807) Decrease by 0.5%-point 2,347 2,074 Rate of compensation increase Increase by 0.25%-point 176 184 Decrease by 0.25%-point (169) (160) Rate of pension increase Increase by 0.25%-point 449 443 Decrease by 0.25%-point (431) (425) Life expectancy Increase by one year 718 629 Sensitivities are calculated based on the same method (present value of the DBO calculated with the projected unit method) as applied when calculating the post-employment benefit obligations. The sensitivity analyses are based on a change of one assumption while holding all other assumptions constant. This is unlikely to occur in practice and changes of more than one assumption may be correlated leading to different impacts on the DBO than disclosed above. If the assumptions change at a different level, the effect on the DBO is not necessarily in a linear relation. The majority of funded plans apply broadly an asset-liability matching framework. The strategic asset allocation of the plans takes into account the characteristics of the underlying obligations. Investments are widely diversified, such that the failure of any single investment would not have a material impact on the overall level of assets. A large portion of assets in 2020 consists of fixed income and equity instruments, although the Company also invests in property, commodities and hedge funds. The Company reassesses the characteristics of the pension obligations from time to time or as required by the applicable regulation or governance framework. This typically triggers a subsequent review of the strategic asset allocation. Plan assets allocation The fair value of the plan assets for retirement plans and deferred compensation can be allocated to the following classes: (In € million) 2020 2019 Quoted prices Unquoted prices Total Quoted prices Unquoted prices Total Equity securities Europe 1,197 0 1,197 1,095 0 1,095 Rest of the world 356 0 356 429 0 429 Emerging markets 503 0 503 535 0 535 Global 2,820 194 3,014 1,816 177 1,993 Bonds Corporates 3,001 271 3,272 1,828 242 2,070 Governments 2,332 0 2,332 2,010 0 2,010 Pooled investments vehicles 295 0 295 415 0 415 Commodities 0 0 0 0 0 0 Hedge funds 0 398 398 0 265 265 Derivatives 0 (129) (129) 0 58 58 Property 0 464 464 0 563 563 Cash and money market funds 3 106 109 1,875 58 1,933 Others 0 1,357 1,357 0 1,296 1,296 Balance at 31 December 10,507 2,661 13,168 10,003 2,659 12,662 52 Airbus / Financial Statements 2020