The Impact of Paradoxical Leadership Dynamics on the Effectiveness of Internal and External Auditing : The Moderating Role of Corporate Governance Characteristics in the Banking Sector" ( Iraq and G .C .C

Abstract

This study aimed to explore the impact of paradoxical leadership dynamics on the effectiveness of internal and external auditing, while examining the moderating role of corporate governance characteristics in the banking sector of Iraq and the GCC countries. Employing a mixed-methods approach (quantitative and qualitative) involving 135 banks and 412 respondents, the study found that paradoxical leadership has a strong positive effect on both internal and external audit effectiveness. Furthermore, the quality of corporate governance not only directly enhances audit effectiveness but also significantly amplifies the positive relationship between paradoxical leadership and audit effectiveness. The results revealed a substantial gap in audit effectiveness favoring GCC banks over Iraqi banks and demonstrated that paradoxical leadership is more impactful in Islamic banks, where Sharia governance plays a unique and powerful moderating role. The study recommends that banks invest in developing paradoxical leadership skills, strengthen the genuine independence of governance mechanisms, address contextual challenges in Iraq such as political influence and regulatory fragmentation, and grant Sharia supervisory boards in Islamic banks a broader strategic role.