From Online Manual
Karma is a feature that shows the popularity of a certain member. To make it available, the administrator must activate it in core features. If members are allowed, they can choose to to raise (Applaud) or lower (Smite) a person's karma. This is how a member's popularity is calculated.
For more information on Karma, see Features and Options -- karma
For more information on setting permissions for Karma, please see Permissions