What is the purpose of the following diode arrangement? I suspect some sort of protection, ESD perhaps?The output is connected to logic.

 

ESD and over-voltage protection. They are called clamping diodes.
The input voltage as seen by the input logic will not go higher than +5V + Vdiode or lower than -Vdiode.

It is advisable to have a resistor in series before the input to protect the diodes from too much current.

Note that in low power CMOS logic if the input is at logic high the circuit will be powered up even if power to the circuit has been turned off, i.e. the circuit will receive “phantom” power.

 

I suspect some sort of protection, ESD perhaps?

ESD protection is included in most logic devices and some discrete devices. External diodes are more likely to clamp the inputs, preventing excursions more than one diode drop above or below the power supply or ground, respectively.

 

If you understand diodes, then think about the situations where the INPUT voltage is at, say, -3V or +7V.