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Medals are awarded to military units in Imperialism and Imperialism 2, up to a maximum of four per unit. Each medal gives the unit greater attack strength and (according to the Imp2 Manual, though some players dispute that) possibly morale.

Upgraded units

A unit that is upgraded because of new technology retains its medals.

Imperialism

The specific article has not been created for (or "Medal" is not part of) Imperialism

All land battles are fought in a sequence of unit moves based on the individual rating of all of the regiments in the battle, this is termed the individual regiment initiative. The order for the unit types is light cavalry, generals, light artillery, regular and heavy infantry, and artillery. Within each unit type, regiments with more medals move earlier. A regiment which earns the maximum of four medals has roughly twice the firepower, both ranged and melee, of a regiment of the same type that has no medals. Capture of a Minor Nation capital will upgrade your Armory resulting in all new regiments start with one medal.

Imperialism 2

The specific article has not been created for (or "Medal" is not part of) Imperialism 2

The Imp2 manual mentions ship medals but says nothing about them. Discussing army units, it says at page 51:

Experience

Regiments gain experience, which is marked by a string of medals on the display. Experience is earned by participating in combat. Generally, participation in three victories or five defeats will earn one medal for the regiment. Experience is much less, however, if the regiment simply retreats without participating in a fight. Each medal affects firepower, melee strength and morale.
A regiment with one medal has its base firepower and melee numbers multiplied by 1.1. A two medal unit’s statistics are multiplied by 1.2. The most medals a unit can earn is four.
Normally a unit suffers a morale loss equal to the actual casualties suffered whenever it is damaged. This is shown in gray on the unit’s health bar during a battle. As a unit gains medals, the amount of morale loss suffered is reduced. A four medal unit suffers no loss of morale at all.

Doubt about "morale"

However, an experienced player adds the following:

The only benefit from medals is increased firepower, both ranged and melee. Movement order in tactical land battle is determined by the player and in strategic land battles by the computer AI. The firepower increases for regiments with a medal rating of x is a multiplier of 1.x over the base values. Conquering 10 provinces gives you the bonus of all future builds of military units.

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