This proven is a statement that means that all things that shine and glitters are not appealing and useful for us. Gold is a pure metal that shines and glitters, but not all things that shine, and sparkle become Gold.
Before getting influenced by the glittery outer appearances, one should ensure the inner qualities of a person or thing. The real value of an object does not depend upon its appearances, as appearances are often deceptive. An individual tends to disguise under various circumstances under those shiny and glittery appearances to survive in this world.
The proverb reflects the outlook of life and that one should believe and never regret life choices.