Is it supposed to be sorted otherwise? Based on lexicographical order, it looks correct.
#let bib = ```bib
@inproceedings{Š, author = {Š}}
@inproceedings{S, author = {S}}
@inproceedings{Z, author = {Z}}
```.text
#bibliography(bytes(bib), style: "chicago-author-date", full: true)
