Are you sure that you want to even be running Sierra (as a guest, or otherwise) here? Trying to keep old software going gets increasingly hassling, as both the app and the OS age out.
If you’re willing to accept the ‘fun” that will arise here, then have backups of everything, as a mistake or a corruption or a bug here is Bad News.
You’ll here be using Disk Utility to prepare some storage for the Sierra installation. Either external storage being presented through to the guest, or some part of the internal storage being presented through to the guest from within Parallels. In most virtual machines, this is either some sort of device passthrough for the external (scratch) storage, or it’s an ordinary (big) file created in the host macOS environment via Parallels, and this (big) file contains the entire file system and contents of a simulated volume storage device within the virtual machine. However this storage is allocated within Parallels, erase, format as GPT/GUID partitioning and an HFS+ file system using Disk Utility, then install Safari onto it.
I’ve recently been using VirtualBox for Linux guests, and am not familiar with current Parallels and its UI. All virtual machines are similar here, but there are some differences in details and syntax and terminology.