Pathfinder marks an email as opened when a contact opens the email in their email client. If an email has been opened it tells you the contact has read - or at least glanced at - the email.
Email open tracking is not bulletproof as explained here.
Pathfinder marks an email as clicked when a contact clicks a link inside the email. This could be either a text or image link. Mailto links are not tracked.
This article goes into more detail how Pathfinder tracks email metrics.