The arm bar can be used in multiple ways depending on the goal.
Sometimes it reinforces trunk stability, sometimes it opens the thoracic spine, and other times it simply builds comfort holding load overhead. In this example, the goal is to promote shoulder external rotation.
It does this by placing the shoulder in abduction under load, which provides feedback to reach long and roll into external rotation. As this happens, the scapulae are encouraged to stay open, allowing the shoulder to remain active and organized while building stability in a more externally rotated position.