reason? -so when that nice German policeman sees you driving on the left, he'll think 'oh, they're just British pig-dogs' and let you off, and when you're in another country they can see you're foriegn and hurl xenophobic abuse at you
The stickers are used for when driving from one European country to the next etc, to identify the vehicle is from another country, and to make other drivers and authorities aware that the driver may not be fully aware of the laws and also might be driving a wrong side drive car etc.
With the new wonderful EU, recent plates have the country identifier built in on the left side of the plate.
The sticker I believe is still nessesary in non-EU states though.