In a Dungeons and Dragons game, I had elves that were the Borderguard, looking after the eaves of the forest to protect the softer settlements deep in the forest from being attacked. I used “loot” as badges of office.
Cloak. Those honored to become members got an elvencloak. Therefore, the Borderguard earned a rep as being invisible in the woods.
Boots. Those trusted to lead small groups got elvenboots. As the elite pulled together for commando raids etc., they needed that stealth boost when hunting monsters and invaders.
Bracers. Those respected to lead operations or be responsible for areas got bracers of archery. They needed to inspire the others by shooting straight and not missing, and also for top priority missions small groups of these tip-of-the-spear warriors were sent.
Therefore, if you clashed with a group of elven Borderguard, in looting the corpses you’d get awesome magic stuff.
The downside? Those badges of office would be recognized anywhere remotely nearby their territory, leading to a lot of awkward questions. The upside? Elven characters might join and advance in the ranks, having these items given to them as signs of regard and trust instead of being trophies stripped from corpses.
Another example. To help players learn the rules, I held a tournament, open to any who wished to participate and could muster up the entry fee.
Each elimination level granted rewards to those participating. The first level was a long, long red sash embroidered with the mark of the Tower sponsoring the event. It turned out to also be useful for cloakfighting.
The second level, they got tough embroidered leather boots ideal for adventuring in places where you can’t be fussy about what you step in, and your feet/legs need lots of protection. The third level, (finally!) a well-crafted dagger with the Tower symbol on the pommel. By the end, the finalists got a leather coat that provided significant protection, and the winner got an enchanted shortsword.
So, the stuff is nice, whatever. The cool thing is, when others see these guys walking around, they can see the marks of the Tower; they know these people did well in the tournament (because it is regionally famous.) Further, those who have the dagger, coat, or sword are known to have advanced quite far, and the one with the shortsword won the tournament and should not be messed with.
Suddenly a paltry handful of utilitarian objects with a minimum of magic become sought-after trophies. They represent earned respect.
In talking about Mark of Station, the heart of the issue really is respect. You can steal a sword that helps you fight better, you can hoist a sack of someone else’s coin away, but those things make you a thief, and now a better equipped thief. These objects tie the character into the game world and stand as symbols of success, trust, and backing.