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I would say that the Protestant Reformation and the Catholic reaction to that Reformation are important for different reasons. Martin Luther’s reforms changed Europe and the world by causing a split in the Christian church in Western Europe. The Catholic response was important because it improved the Church and got it away from some of the worst of its medieval abuses.
Until the Reformation, there was only one Christian church in Western Europe. After the Reformation, there were Catholics and Protestants. Soon after that, there came to be many different kinds of Protestants. This meant that there was now religious diversity in Western Europe. With religious diversity came religious conflict. It was now possible for countries to fight one another at least partly on religious grounds. This was a new and important thing in Europe.
In the few centuries before the Reformation, the Catholic Church had arguably lost its way. It was becoming corrupt and excessively worldly. Bishops and other important leaders were using their positions to become rich and powerful. Important church leaders up to and including popes (all of whom were supposed to be celibate) had illegitimate children. Many of them engaged in rank nepotism, giving church offices to their offspring. The Church did not seem to care nearly as much about its flock as it cared about its power. When the Protestant Reformation occurred, this changed. The Church reformed itself in an effort to limit the damage being done by the Reformation. This ended the worst of the abuses by church leaders and the Church got much closer to doing the things it was supposed to be doing in the first place.
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