Neither assessment nor feedback require letter grades. Some schools without grades use a portfolio system where you have to complete projects in various areas

Neither assessment nor feedback require letter grades. Some schools without grades use a portfolio system where you have to complete projects in various areas and some sort of capstone project or thesis to graduate. Graduate programs largely work that way as well. They may have a qualifying process, but actual letter grades are largely irrelevant. Students still get feedback on their projects, and they graduate with a CV and work portfolio that they can show to employers or graduate programs.