For the setup shown in your picture it may well be that on the road you MIGHT never have an issue. It's obviously solidly pinched by the lower screw but the tube only gets up to 1/2 way to the top screw. Then there's your shim. To me that actually hurts the final strength of the joint because it allows the actual stem to work with more leverage and less steer tube engagement.

For casual riding it would likely stay in place. But when you stand up and start levering off the bars while crunching up a hill or similar there's a darn fine chance that you'll suddenly find yourself holding a set of bars with no steer tube connection. And that's the real test isn't it....

For single screw stems I want to see the proper 3 to 4 mm clearnance only for the cap. For longer two screw stems I'm a little more daring but I want to see the upper screw fully pressing on the steer tube at least. If not I may use the stem for a few days but only until I can ride to the bike stor and get one that fits correctly.

What you show with the shim? I MIGHT ride to the bike shop since it's not far and it's all level and if I can lift, tug and lever at the bars in my shop and they don't budge then I would trust it that far. But definetly not for regular riding looking like that.