Aliases no longer retain the custom icons of their targets

If you create a symbolic link, it does retain the custom icon.

Ultimate you will have to do this with the Terminal, but you could wrap that in an Apple script, Automator, and make it a service.

Although the alias inheriting the original folder icon worked in Mojave, Apple has since changed that behavior without consulting you or me, and that functionality is now gone in Big Sur. You get plain alias icons now.

There are two approaches to replicating your folder image in an alias using AppleScript and one using the Terminal:

use scripting additions

set thisFolder to POSIX path of (choose folder) as text
set trimmed to ((characters 1 thru -2 of thisFolder) & " alias") as text
do shell script "ln -s " & thisFolder & space & trimmed's quoted form)
return

or with AppleScript/Objective-C:

use framework "Foundation"
use AppleScript version "2.4" -- at least Yosemite
use scripting additions

property NSURL : a reference to current application's NSURL
property NSFileManager : a reference to current application's NSFileManager

set thisFolder to POSIX path of (choose folder) as text
set tf_url to NSURL's fileURLWithPath:thisFolder
set al_url to NSURL's fileURLWithPath:(((characters 1 thru -2 of thisFolder) & " alias") as text)
NSFileManager's defaultManager()'s createSymbolicLinkAtURL:al_url withDestinationURL:tf_url |error|:(reference)
return

or

at the terminal command line creating a soft link to the folder alias name:

ln -s /Users/username/Desktop/Junk /Users/username/Desktop/Junk\ alias

Tested: macOS 11.4