I think that bushing is part of the COO mount system....I have the same gauge on my test engine, here's a photo. There are two pinch clamps welded together at 90°...the top one clamps on the bushing, bottom one on the handlebar.
I get that it is used to clamp it to the handlebar....what didn't make sense to me is why the two brass fittings are not removable. Not really a big deal, they're easy to find.