Lighttpd

Is this issue about the password provided in the config file? (auth.backend.ldap.bind-pw) This would suggest that the entire config file should be converted from the current locale into UTF-8 prior to parsing. It is probably better to store your config file in UTF-8, rather than any other native encoding.

More likely: Is this issue about the password provided by the client in HTTP Basic Authentication? Until recently, (https://tools.ietf.org/html/rfc7616 and https://tools.ietf.org/html/rfc7617 September 2015), there was no standard which specified the encoding to use. This is explained well at:
http://stackoverflow.com/questions/702629/utf-8-characters-mangled-in-http-basic-auth-username

This patch updates mod_auth to send Basic and Digest authentication header WWW-Authenticate with the optional charset="UTF-8" param

diff --git a/src/mod_auth.c b/src/mod_auth.c
index 5c6dae3..1111323 100644
--- a/src/mod_auth.c
+++ b/src/mod_auth.c
@@ -298,7 +298,7 @@ static handler_t mod_auth_uri_handler(server *srv, connection *con, void *p_d) {
                if (0 == strcmp(method->value->ptr, "basic")) {
                        buffer_copy_string_len(p->tmp_buf, CONST_STR_LEN("Basic realm=\""));
                        buffer_append_string_buffer(p->tmp_buf, realm->value);
-                       buffer_append_string_len(p->tmp_buf, CONST_STR_LEN("\""));
+                       buffer_append_string_len(p->tmp_buf, CONST_STR_LEN("\", charset=\"UTF-8\""));

                        response_header_insert(srv, con, CONST_STR_LEN("WWW-Authenticate"), CONST_BUF_LEN(p->tmp_buf));
                } else if (0 == strcmp(method->value->ptr, "digest")) {
@@ -307,7 +307,7 @@ static handler_t mod_auth_uri_handler(server *srv, connection *con, void *p_d) {

                        buffer_copy_string_len(p->tmp_buf, CONST_STR_LEN("Digest realm=\""));
                        buffer_append_string_buffer(p->tmp_buf, realm->value);
-                       buffer_append_string_len(p->tmp_buf, CONST_STR_LEN("\", nonce=\""));
+                       buffer_append_string_len(p->tmp_buf, CONST_STR_LEN("\", charset=\"UTF-8\", nonce=\""));
                        buffer_append_string(p->tmp_buf, hh);
                        buffer_append_string_len(p->tmp_buf, CONST_STR_LEN("\", qop=\"auth\""));

committed in 4b412797