The Shaman's Cloak is an item gained by defeating 8 colossi on Hard Time Attack. It reduces the damage colossi do to Wander. It has no effect on the damage he deals to colossi, however. It is the same cloak that Lord Emon wears, and goes along with the Shaman's Mask, and white Agro.
Dormin says the following upon retrieving the item:
That is the "Shaman's Cloak"...
By wearing it, thou shalt receive less injuries..