CAF stands for Common Assessment Framework. It is an assessment used when a school (or any other agency) has concerns about a child or young person (CYP). The aim is to (a) identify a CYP's needs early, before problems become really serious, and (b) make sure that agencies co-ordinate their response and work together so that no CYP 'falls through the gaps' (which can happen if the agencies all assume someone else is taking action). It builds up a 'whole picture' of a CYP's needs - their health, development, welfare, behaviour, progress in learning or any other aspect of their well-being.
It's voluntary, you don't have to consent, BUT it is a good thing that the school is taking your son's needs seriously and taking this 'joined up' approach. :) It means that if your son needs any support that the school can't give directly, it should be easier to get it. The CAF is basically a request for further support.
You and your family are central - you are the 'experts' on your son, so your views will be a key part of the assessment.
It does NOT mean there are any safeguarding/child protection concerns about your son. Lots of parents worry about this, but in fact there are separate processes for that. If the school or any agency thinks a CYP is 'at risk' in any way, they have to use/follow local safeguarding procedures, not CAF.
The assessment will lead to an 'action and delivery plan' for your son. You said the school has already got a PIP in place for your son, and the new plan will be quite like this, but it will (probably) include support from other services too.
There will be a 'lead practitioner' responsible for doing the CAF, working with you and your son, getting in touch with other agencies, making the plan, etc... This will probably be someone from school with whom your son already has a relationship - ideally someone he has a good relationship with. This person can be crucial to the support your son gets, so try to judge whether they are someone who cares and will get things done, and push for a different 'lead practitioner' if you feel, after a few weeks, that nothing is getting done.
There is a lot of other information here, including all the forms they will use during the CAF process:
www.education.gov.uk/childrenandyoungpeople/strategy/integratedworking/caf/a0068957/the-caf-process
Hope that helps :)