The Co:Z launcher tries to use the target system's default codepage for translation of text. Apparently, your target system has a default codepage of "ANSI_X3.4-1968", which is not recognized by iconv() on z/OS, so it falls back to using ISO8859-1 (Latin 1 ASCII). ANSI-X3.4-1968 is the old "ASCII" standard, which is a subset of the newer ISO8859-1, which is why it worked OK.
If you want to prevent this message, you can configure the codepage used by the "client" running on the target system by setting the "COZ_CLIENT_CODEPAGE" environment variable on the target system.
One way to do this is to add this line to your //COZCFG properties: