Risk Maturity and Cash Depletion: A Dynamic Quadrant Analysis of Energy Firms

Abstract

Energy firms face acute pressure to preserve financial resources while maintaining robust risk governance, yet they frequently experience severe cash depletion. This study examines how risk governance maturity relates to cash depletion among six IDX-listed energy companies from 2021 to 2024. Drawing on the Levers of Control framework, the Risk Maturity Index (RMI) is conceptualized as a boundary system, and a high Net Burn Rate (NBR) is framed as sustained net cash depletion. Utilizing Mean Comparison Analysis and a Dynamic Quadrant Matrix, observations were classified relative to the mean RMI (3.94) into four quadrants: High Resilience, Vulnerable, High Burn, and Passive Efficiency. The findings reveal that while formal risk maturity is relatively high (mean RMI of 3.94), a significant portion of observations experience high cash depletion, concentrated across the Vulnerable (41.67%) and High Burn quadrants. This demonstrates that formal risk compliance does not automatically guarantee cash resilience. For managers, these results highlight the urgency of integrating risk maturity with active capital allocation strategies. For regulators, it emphasizes the need to evaluate risk governance beyond mere administrative compliance to ensure true financial sustainability.