You can delete it by grounding dark green/red wire. The diode is used as a way to make the neutral sensor and clutch safety switch play nicely together
Ground the green/red off the starter solenoid. You can now delete the clutch perch switch and have no ill effects
It is more a redundancy to make a bike more safe for people who don't ride or don't know basics of safe riding. Always check to see if in gear before starting, or pull in clutch. Without it someone inexperienced could really get hurt