The Swinging Pirate can be seen from a pair of Binoculars located in Elephant Escarpment. Since he can only be seen through the Binoculars, finding the Swinging Pirate is crucial to completing the Gnarled Forest Observer achievement. Other than this, the Swinging Pirate has no in-game role.
If players jump off the cliff near his position, the Swinging Pirate can be seen. In a glitch that was patched February 2011, players who jumped with perfect coordination onto a tree leaf that appears to be solid could stand next to the pirate. When interacted with, the minifigure would swing just as when viewed in the binoculars.