I can work out all the bits of the semi integrated headset, the star fangled nut for the steerer, but I can't see why I need this?
It has similar diameter to the steerer tube, is it a spacer? I don't get it! :/
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1Welcome to Stack Exchange - thank you for a well-formed question with a useful photo. – Criggie♦ Jun 16 at 1:11
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That looks like the compression ring for a threadless headset.
Images by keithonearth on Wikimedia Commons, reproduced under Gnu free documentation license
More information found at Sheldon Brown
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It is indeed a compression ring, David D’s diagram is helpful to illustrate the following:
What it does is transfer the force of the cap bolt to the inner face of the cartridge bearing. That then compresses the ball bearings inside properly, as they need to be, which is why the split ring is called a compression ring. The angled face must fit into the angled bearing race to do so, so both must be the right way round.
The crown race does the same job of compressing the lower bearing from below, see how it has the same angle on it, just facing upwards instead.
Together, the compression ring and the crown race squeeze the whole headset bearing assembly together, allowing proper and safe adjustment.
You need to fit it!
Also make sure you get all the parts in the correct orientation or you won’t have a safe and adjustable headset.
