A crucial determinant of the success or failure of collaborative group work is the effect of peer feedback interventions on learning. Research exploring such effects on developing soft skills is sparse. This study seeks to address whether peer feedback leads to enhanced teamwork behaviour and self-assessment ability, two skills highly sought after by employers. Specifically, this study examines the direct effect of formative performance rating and the mediating effect of praise and criticism in peer feedback messages on achievement in teamwork and self-assessment skills. The sample consists of quantitative and qualitative data from 98 students enrolled in business programmes using a particular form of collaborative group work. The paper finds a direct positive relationship between formative performance rating and summative self-assessment ability. It also finds that praise negatively mediates the relationship between formative performance rating and summative teamwork. Further analyses suggest that a significant proportion of comments provided is past rather than future-oriented. Potential strategies to overcome the limitations of current practices are discussed.