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STOCKHOLDERS' EQUITY
 12 Months Ended
Dec. 31, 2019
Stockholders' Equity Note [Abstract]  
STOCKHOLDERS' EQUITY STOCKHOLDERS’ EQUITY
Merger with Historical DuPont
Effective with the Merger, each share of TDCC Common Stock (excluding any shares of TDCC Common Stock that were held in treasury, which were automatically canceled and retired for no consideration) was converted into the right to receive one fully paid and non-assessable share of DowDuPont Common Stock. As a result, in the third quarter of 2017, the Company recorded a reduction in "Treasury stock" of $935 million, a reduction in "Common stock" of $3,107 million and an increase in "Additional paid in capital" of $2,172 million in the consolidated balance sheets. See Note 3 for additional information.

Common Stock
Dow Inc.
Dow Inc. was incorporated in 2018 with 100 authorized and issued shares of common stock, par value $0.01 per share, owned solely by its parent company, DowDuPont. In the first quarter of 2019, in connection with the separation and distribution of DowDuPont’s materials science business, the number of authorized shares of common stock was increased to 5,000,000,000 shares, par value $0.01 per share, and Dow Inc.'s 100 shares of issued common stock were recapitalized into 748,771,240 shares of common stock. Dow Inc.'s common stock was solely owned by DowDuPont through March 31, 2019, and on April 1, 2019, Dow Inc. became an independent, publicly traded company. Dow Inc. common stock is listed on the NYSE under the symbol “DOW.” See Notes 3 and 4 for additional information.

The Company may issue Dow Inc. common stock shares out of treasury stock or as new common stock shares for purchases under the Employee Stock Purchase Plan ("ESPP"), for options exercised and for the release of restricted stock units ("RSUs") (formerly termed deferred stock), performance stock units ("PSUs") (formerly termed performance deferred stock) and restricted stock. Subsequent to the separation from DowDuPont, the number of new Dow Inc. common stock shares issued to employees and non-employee directors was approximately 2.5 million in 2019. Prior to the Merger, the number of new TDCC common stock shares issued to employees and non-employee directors was zero in 2017. See Note 22 for additional information on changes to the Company's equity awards in connection with the Merger and separation from DowDuPont.

TDCC
Effective with the Merger and through March 31, 2019, TDCC had 100 authorized and issued shares of common stock, par value $0.01 per share, owned solely by DowDuPont. Effective with the separation from DowDuPont, TDCC became a wholly owned subsidiary of Dow Inc., which now holds all 100 authorized and issued shares of common stock of TDCC. See Notes 3 and 4 for additional information.

Retained Earnings
Dow Inc.
There are no significant restrictions limiting Dow Inc.’s ability to pay dividends. Subsequent to the separation from DowDuPont, Dow Inc. declared dividends of $2.10 per share in 2019.

Undistributed earnings of nonconsolidated affiliates included in retained earnings were $852 million at December 31, 2019 and $1,856 million at December 31, 2018.

TDCC
Prior to the Merger, TDCC declared dividends of $1.38 per share in 2017. Effective with the Merger, TDCC no longer had publicly traded common stock. TDCC's common shares were owned solely by DowDuPont, prior to the separation on April 1, 2019, and TDCC's Board of Directors determined whether or not there would be a dividend distribution to DowDuPont. Effective with the separation from DowDuPont on April 1, 2019, TDCC became a wholly owned subsidiary of Dow Inc. and TDCC's Board of Directors determines whether or not there will be a dividend distribution to Dow Inc. See Note 26 for additional information on dividends paid by TDCC to DowDuPont and Dow Inc.

See Note 4 for information on the impact of the receipt of ECP, which was accounted for as a transfer between entities under common control.

Employee Stock Ownership Plan
The Dow Employee Stock Ownership Plan (the “ESOP”) is an integral part of The Dow Chemical Company Employees’ Savings Plan (the “Plan”). A significant majority of full-time employees in the United States are eligible to participate in the Plan. The Company uses the ESOP to provide its matching contribution in the form of stock to Plan participants. Prior to the Merger, contributions were in the form of TDCC Common Stock. Effective with the Merger, shares of TDCC Common Stock held by the ESOP were converted into shares of DowDuPont Common Stock at a ratio of 1:1. Effective with the separation from DowDuPont, the DowDuPont Common Stock held by the ESOP received a Dow Inc. Common Stock share dividend at a ratio of 3:1, resulting
in the ESOP holding both DowDuPont and Dow Inc. shares. Subsequent to the separation from DowDuPont, the ESOP independent fiduciary sold the DowDuPont shares and purchased additional Dow Inc. shares with the proceeds.

In connection with the acquisition of Rohm and Haas on April 1, 2009, the Rohm and Haas Employee Stock Ownership Plan (the "Rohm and Haas ESOP") was merged into the Plan, and the Company assumed the $78 million balance of debt at 9.8 percent interest with final maturity in 2020 that was used to finance share purchases by the Rohm and Haas ESOP in 1990. The outstanding balance of the debt was $3 million at December 31, 2019 and $10 million at December 31, 2018.

Dividends on unallocated shares held by the ESOP are used by the ESOP to make debt service payments and to purchase additional shares if dividends exceed the debt service payments. Dividends on allocated shares are used by the ESOP to make debt service payments to the extent needed; otherwise, they are paid to the Plan participants. Shares are released for allocation to participants based on the ratio of the current year’s debt service to the sum of the principal and interest payments over the life of the loan. The shares are allocated to Plan participants in accordance with the terms of the Plan.

Compensation expense for allocated shares is recorded at the fair value of the shares on the date of allocation. Compensation expense reflected in income from continuing operations for ESOP shares was $77 million in 2019, $144 million in 2018 and $200 million in 2017. At December 31, 2019, 12.6 million shares out of a total 16.1 million shares held by the ESOP had been allocated to participants’ accounts and 3.5 million shares, at a fair value of $190 million, were considered unearned.

Treasury Stock
Dow Inc.
On April 1, 2019, Dow Inc.'s Board of Directors ratified the share repurchase program originally approved on March 15, 2019, authorizing up to $3 billion to be spent on the repurchase of the Company's common stock, with no expiration date. In 2019, Dow Inc. repurchased $500 million of Dow Inc. common stock. At December 31, 2019, $2.5 billion of the share repurchase program authorization remained available for repurchases.

TDCC
In 2013, TDCC's Board of Directors approved a share buy-back program. As a result of subsequent authorizations approved by TDCC's Board of Directors, the total authorized amount of the share repurchase program was $9.5 billion. Effective with the Merger, the share repurchase program was canceled. Over the duration of the program, a total of $8.1 billion was spent on the repurchase of TDCC Common Stock.

The Company may issue shares for purchases under the ESPP, for options exercised as well as for the release of RSUs, PSUs and restricted stock out of treasury stock or as new common stock shares. The number of treasury shares issued to employees and non-employee directors under the Company’s stock-based compensation programs are summarized in the following table. See Note 22 for additional information on changes to the Company equity awards in connection with the Merger and separation from DowDuPont.

Treasury Shares Issued Under Stock-Based Compensation Programs
2019 1
2018
2017 2
To employees and non-employee directors
—

N/A
14,194,282

1.
Reflects Dow Inc. activity subsequent to the separation from DowDuPont.
2.
Reflects TDCC activity prior to the Merger.

The following table provides a reconciliation of Dow Inc. common stock activity for the years ended December 31, 2019 and 2018:

Shares of Dow Inc. Common Stock
Issued
Held in Treasury
 
Balance at Jan 1, 2018
—

—

Issued 1
100

—

Balance at Jan 1, 2019
100

—

Impact of recapitalization
748,771,140

—

Issued 2
2,457,404

—

Repurchased
—

9,729,834

Balance at Dec 31, 2019
751,228,644

9,729,834

1.
Dow Inc. was incorporated in 2018 with 100 authorized and issued shares of common stock, par value $0.01 per share.
2.
Shares issued to employees and non-employee directors under the Company's equity compensation plans.
Accumulated Other Comprehensive Loss
The changes in each component of AOCL for the years ended December 31, 2019, 2018 and 2017 were as follows:

Accumulated Other Comprehensive Loss
2019
2018
2017
In millions
Unrealized Gains (Losses) on Investments
 
 
 
Beginning balance 1
$
(51
)
$
17

$
43

Unrealized gains (losses) on investments
178

(93
)
38

Less: Tax (expense) benefit
(38
)
19

(13
)
Net unrealized gains (losses) on investments
140

(74
)
25

(Gains) losses reclassified from AOCL to net income 2
(33
)
9

(110
)
Less: Tax expense (benefit) 3
8

(2
)
39

Net (gains) losses reclassified from AOCL to net income
(25
)
7

(71
)
Other comprehensive income (loss), net of tax
115

(67
)
(46
)
Reclassification of stranded tax effects 4
—

(1
)
—

Ending balance
$
64

$
(51
)
$
(3
)
Cumulative Translation Adjustment
 
 
 
Beginning balance
$
(1,813
)
$
(1,481
)
$
(2,381
)
Gains (losses) on foreign currency translation
59

(215
)
1,006

Less: Tax (expense) benefit
(2
)
(6
)
(98
)
Net gains (losses) on foreign currency translation
57

(221
)
908

(Gains) losses reclassified from AOCL to net income 5
(89
)
(4
)
(8
)
Other comprehensive income (loss), net of tax
(32
)
(225
)
900

Impact of common control transaction 6
710

—

—

Reclassification of stranded tax effects 4
—

(107
)
—

Ending balance
$
(1,135
)
$
(1,813
)
$
(1,481
)
Pension and Other Postretirement Benefits
 
 
 
Beginning balance
$
(7,965
)
$
(6,998
)
$
(7,389
)
Gains (losses) arising during the period
(1,699
)
(625
)
(3
)
Less: Tax (expense) benefit
413

130

(20
)
Net gains (losses) arising during the period
(1,286
)
(495
)
(23
)
Amortization and recognition of net loss and prior service credits 7
504

594

607

Less: Tax expense (benefit) 3
(117
)
(139
)
(193
)
Net loss and prior service credits reclassified from AOCL to net income
387

455

414

Other comprehensive income (loss), net of tax
(899
)
(40
)
391

Impact of common control transaction 6
83

—

—

Reclassification of stranded tax effects 4
—

(927
)
—

Ending balance
$
(8,781
)
$
(7,965
)
$
(6,998
)
Derivative Instruments
 
 
 
Beginning balance
$
(56
)
$
(109
)
$
(95
)
Gains (losses) on derivative instruments
(470
)
6

2

Less: Tax (expense) benefit
101

(2
)
(1
)
Net gains (losses) on derivative instruments
(369
)
4

1

(Gains) losses reclassified from AOCL to net income 8
44

89

(13
)
Less: Tax expense (benefit) 3
(13
)
(18
)
(2
)
Net (gains) losses reclassified from AOCL to net income
31

71

(15
)
Other comprehensive income (loss), net of tax
(338
)
75

(14
)
Reclassification of stranded tax effects 4
—

(22
)
—

Ending balance
$
(394
)
$
(56
)
$
(109
)
Total AOCL ending balance
$
(10,246
)
$
(9,885
)
$
(8,591
)

1.
The beginning balance of "Unrealized gains (losses) on investments" for 2018 was increased by $20 million to reflect the impact of adoption of ASU 2016-01.
2.
Reclassified to "Net sales" and "Sundry income (expense) - net."
3.
Reclassified to "Provision for income taxes."
4.
Amounts reclassified to "Retained earnings" as a result of the adoption of ASU 2018-02.
5.
Reclassified to "Sundry income (expense) - net."
6.
Reclassified to "Retained earnings" as a result of the separation from DowDuPont on April 1, 2019. See Note 4 for additional information.
7. These AOCL components are included in the computation of net periodic benefit cost of the Company's defined benefit pension and other postretirement benefit plans. See Note 21 for additional information.
8. Reclassified to "Cost of sales," "Sundry income (expense) - net" and "Interest expense and amortization of debt discount."