On a frosty winter’s morning in Oxford, pupils at St Aloysius’ Catholic primary school file into the hall for their end-of-week assembly. Today the headteacher will be handing out certificates to those who have displayed the school’s “virtues”. The head, Tom Walker, calls on one or two children from each class to receive awards highlighting how they have supported friends, or taken a risk, or perhaps played with a child who was on their own.

Each announcement is followed by enthusiastic applause. One year 6 pupil high-fives his friend as he walks up. Others pat their classmates on the back.

The Virtues awards are new, replacing a system that rewarded academic work and good behaviour. Most primary schools in England use these sorts of schemes – often called Star of the Week. But there is growing unease among teachers, parents and experts who say awards can do more harm than good: that, if not managed carefully, they encourage unhealthy competition or an expectation of reward.

Another Oxford school, North Hinksey primary, has also introduced a values-based system. The head, Amy Pearce, says the problem with awards such as Star of the Week is that they risk excluding some children: “If you’re that child that doesn’t get one, I mean that’s just an appalling feeling.”

Previously Pearce felt the awards system tended to exclude disadvantaged children. “Some of those children were really vocal, saying, ‘that’s not fair’, and I thought, ‘you know what, actually, it isn’t fair’.”

One parent explains how his daughter was upset by her school’s system. “Her class had been hatching chicks from eggs. Instead of being really excited about the chicks she was commenting she hadn’t got a certificate for looking after them well. Every time you’re giving the award to somebody, you’re not giving it to someone else. And that can seem more of a failure than the positive thing of other children getting them.”

Discussions on the parenting forum Mumsnet echo the concerns. Common complaints are that well-behaved children are overlooked or that awards are arbitrary or biased. The most heartfelt concerns come from those whose children have been upset and demotivated. One parent says: “It’s destroying her confidence every week she’s not picked. She said she tries really hard and it makes her feel like her best isn’t good enough and that she’s rubbish.”

At St Aloysius, Walker says there had been complaints about the old system from parents who said their child felt “unrecognised” and “overlooked”. Under the new system, pupils can nominate examples of “virtuous” behaviour, and awards are often discussed with the class. Walker says the difference is that awards recognise behaviour that goes “above and beyond”. He says everyone can expect to receive an award at some point and the system is a conscious effort to move away from rewarding academic achievement or regular good behaviour.

Children at St Aloysius get certificates for going ‘above and beyond’. Photograph: Graeme Robertson/The Guardian

One of the most vocal critics of school rewards is the US author and education expert Alfie Kohn. In his book Punished by Rewards: The Trouble with Gold Stars, Incentive Plans, A’s, Praise and Other Bribes, he argues that they are counterproductive. He describes an experiment in which children were given puzzles to solve. When the time was up, those who had been promised a reward stopped, whereas the children who were not expecting to get anything, continued.

Even worse, Kohn argues, are public and competitive awards, which can damage motivation and self-esteem, and undermine a sense of community and collaboration: “The central message is that everyone else is a potential obstacle to one’s own success,” he says.

However, the child clinical psychologist Naira Wilson says Star of the Week awards provide valuable acknowledgment or recognition. “Sometimes acknowledgment feels good, particularly if it is lacking at home.” She emphasises that this should be purely about the individual, not about comparison with others: “Having the public acknowledgment is demonstrating you’re important, but not that you’re better than someone else.”

Kohn, though, remains sceptical: “Referring to a reward by a euphemism such as ‘recognition’ or ‘celebration’ doesn’t make it any less damaging,” he says.

The children at St Aloysius are enthusiastic about their Virtues awards: “It makes me feel proud,” says one. “It makes you realise teachers really notice everybody,” says another. Nevertheless, one pupil says certificates should not be necessary. “You don’t have to go round saying, hey, did you know I was being loving and compassionate.” Another says: “They’re just paper.”

But if you are going to award certificates, the key thing, says Pearce, is to make sure they are inclusive: “You can find something in every child to recognise.”