From v9.5.2, swatches are deprecated and discontinued in favour of showing the first (if any) of a notes defined flags ($Flags), as described here.
This feature and its associated system attribute are now essentially non-functional.
Legacy use
Outlines can show a square colour swatch, including border and pattern information, in the area reserved for the link widget between the note's icon and its badge. Because of the swatch's positioning, when a note with a swatch is selected, the link widget temporarily replaces the swatch.
The main aim of this feature is to allow the display of progress using the 'bar' and 'vbar' patterns that display a progress bar in map note icons.
Swatches are activated via the $OutlineColorSwatch attribute.
This feature can be toggled on/off via the Appearance Inspector's Outline tab.