The most common and most likely answer to this crossword clue is the 8 letter word NEPOTIST
I've seen this crossword clue in Financial Times
N
E
P
O
T
I
S
T
Buddy explains!
The straight part
We know that "One undeservedly showing preference for PAL" is the straight/definition part of the clue. The straight part is often a synonym or definition, in this case one undeservedly showing preference for pal = nepotist.The cryptic/wordplay part
In cryptic crossword there's often an wordplay/cryptic part as well.This part involves a more complex hint, such as an anagram, homophone, hidden word, etc.
Sadly, We don't have an explanation for this specific crossword clue yet.