I'm not sure why you posted this with all caps in the topic, but um... ok, i'll try to answer: I have always found that XP as a reward leads to players of differing power levels, and can unbalance the game. There are also times when absences can't be helped. For example, all players in my games are made aware that I live with my grandfather, who I care for. If, a few hours before a game, he has some emergency, he comes first, and I won't be there, even if this is a game I am GMing. What i find is a flavorful macguffin for showing up, or a temporary penalty for absences that i wasn't told about in advance seem to work. For example, I'll give the players who are on time a fate point, or one free re-roll to be used that evening, and players who miss a session may find that they begin the following session unsure where they are, or possibly fatigued, drunk, or have some other penalty that can be rested off applied to them. Just enough to remind them that they should have been there, but not enough to make them hate me, or not enjoy my game. As for penalties or cookies for things like updating the characters ahead of time or roleplaying more, that's pretty easy to handle as well. Fate points, for example, simply aren't going to the quieter players as much, It's just how they work. The last game I ran, I updated the players characters myself when they leveled up. They were given plenty of notice, and the option to ask me for help leveling themselves up. If they didn't, they got the one i designed. This meant that if they had a specific goal in mind for their character, they had to make the effort, but if they didn't really care, they still had something useable at the level they should be. Overall, I wouldn't look at it as a system of rewards and penalties, but as causalities and preparations you can make as a GM. I hope my reply was helpful.