Awards in the SCA are given by the Crown (or The Crown’s representatives) as a mark of achievement or acknowledgement for a variety of categories. There are Society-level awards, titles, and ranks that are recognized in every Kingdom, Kingdom-level awards that are specific to just Caid, and even some Baronial or Shire awards in local group.
There is an excellent article on the Caid Wiki about the Giving and Receiving of Awards., written by Baron Malcolm Alberic.
Levels of Awards
The highest rank within the SCA is the Patent of Arms or “peerage.” There are four peerages in the Society and they are recognized across every kingdom. The Order of Chivalry is given in recognition of excellence in the arts of heavy combat. The Order of the Laurel is given in recognition of excellence in artistic or scientific skills and achievement. The Order of the Pelican is given in recognition of excellence in service. And the Order of Defense is given in recognition of excellence in the arts of rapier combat.
Additionally, there are awards that vary for a Grant of Arms or an Award of Arms.
There are some wonderful descriptions and images of the medallions that are given with the Kingdom awards here: http://royals.sca-caid.org/awards/awards.php
Not all Kingdom awards are either Grants of Arms or Awards of Arms, although many are.
Making Award Recommendations
You can recommend anyone for an award. You can find an online recommendation form on the Kingdom page.