My first badges were in Girl Scouts (grew up in the States). If I recall correctly, they were skills and performance based where the group leader determined if I had completed the tasks necessary to obtain the badge. Those tasks were clearly defined by the Girl Scout organization.
More recently my kids achieved their Master Magi badges--a pin and status --awarded in the MagiQuest game at Great Wolf Lodge.The database records their achievements via some technology embedded in a wand. I'm guessing it's some RFID tech. In this game, my children had to play (with support), solve riddles, move throughout the building, interact with items in specific sequences and complete specific adventures with "runes" they aquired through quests.