Informal institutions and “Imperfect Equity” in internationally financed adaptation in Madagascar and Mauritius

International adaptation finance is key to climate justice, yet concern is growing that funding is inequitable and failing to reach the communities most vulnerable to climate impacts. Under UN climate funds, national governments play an important role in distributing adaptation finance within their borders. Informal institutions, such as clientelism and patronage, have been shown to influence governments’ distribution of public resources, in many cases undermining equity. This comparative case study examines how patronage in Madagascar and clientelism in Mauritius influenced government decision-making in two UN Adaptation Fund projects. We draw on 105 interviews with national level policymakers, civil society representatives, and Adaptation Fund project actors. We find that informal institutions strongly influenced decision-making and distribution of project benefits in both countries, but the projects diverged significantly in meeting the Adaptation Fund’s mandate to benefit “particularly vulnerable” communities. We identify two primary characteristics that explain these divergent outcomes: the interaction of informal institutions with formal institutions of accountability; and the alignment of formal and informal incentives for project actors to advance equity. We argue that adaptation organizations should adopt an “imperfect equity” approach that focuses on positive outcomes and understanding the circumstances under which they occur. Such an approach can yield insights that inform concrete strategies for navigating informal institutions, while contributing to progress toward more equitable and accountable institutions long-term.