This utility is here to aid staff when they need to have a password reset (for example vpn access) and they cannot access the normal internal portals to do that.
It works using something called 'Diffie Hellman Key exchange' combined with a 'KDF'. You can read about the science behind those here and here if you are interested.
In essence we are using the magic of mathematics to exchange some public information between two people and then those two people get the same 'secret', whilst anyone in the middle watching the public information will be unable to work out that 'secret'.
In practice, this means that only you and the person resetting your password have any knowledge of that password.
It's worth noting that no secret data is sent to any server using this system. Everything is worked out on YOUR local computer.