I think it absorbs the power of the Type Plates.
dude you can still se a bit of it by his front right leg lol
It reminds me of a wheel, which is a buddhist symbol representing the eight ways to reach nirvana. And arceus is the "creator" pokemon... But I'm probably over-interpreting it.
Avalokitesvara (Janraisig) The Glorious Gentle One, he is the Bodhisattva of Compassion and is either pictured with 11 heads and 1000 arms (Chogdanjandan janraisig) or in a white four armed manisfestation (Chagsh janraisig). The Dalai Lama is considered an incarnation of Avalokitesvara.
I think it absorbs the power of the Type Plates.