Body composition is a much more accurate representation of a person's leanness than scale weight or Body Mass Index (BMI), because it does not rely on height and weight alone to measure leanness. It measures the ratio of body fat to lean tissue and bone in the body, not scale weight.
This is important, because a person may have a high-scale weight (even for their height), yet have also have a high muscle-to-fat ratio which makes them extremely lean. That same person might be labeled overweight using the standard BMI calculation, which does not take into account body composition, only mass (weight) relative to your height, weight, age and gender.
Excess body fat, or a body composition with a high fat-to-muscle ratio is unfavorable because it increases the risk of cardiovascular disease, Type II Diabetes, Metabolic Syndrome and certain cancers. Excess body fat, especially at levels considered obese, can also put stress on the joints and interfere with mobility and the ability to perform everyday activities.
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If you see your fat vs. lean muscle mass, you won't obsess because muscle weighs more than fat. So you could weigh alot but have a very low percent body fat. If you didn't know your % body fat you could keep trying to loose weight but you won't be a ble to.