Practicing self-awareness is about learning to better understand why you feel what you feel and why you behave in a particular way. Having this awareness gives you the opportunity and freedom to change things about yourself, enabling you to create a life that you want. It’s almost impossible to change and become self-accepting if you are unsure as to who you are. Having clarity about who you are and what you want can be empowering, giving you the confidence to make changes.
Better source for why SA is important from a psych and human development standpoint (relates to identity too)