Any sign of insects? When you say rotted wood are you sure there are no termites?
If not I would not be too concerned as it's obivious this has been ongoing over a long period of time.
Either way I would mix up a batch of this stuff as soak the wall and ground level of that wall.
I use this as a general spray for various things, including foundation treatment as a preventive. If you have a sprayer a gallon is an economical size, as you can use it for general bug control too. I personally have found this company reputable and fast shipping. Not that it means much I guess, if you can find better pricing. Just make sure the active ingredient is the same high percentage vs stuff like premixed. It only takes about 1 to 2 oz per gallon of water. Just read instructions.
https://www.domyown.com/bifen-it-p-226.html
If termite damage I would strongly consider this.
https://www.domyown.com/termidor-sc-p-184.html
Im not an expert, in many decades of owning homes (and as a young adult late teenager working in a garden center.
I do my own treatment/preventive, When selling our past homes, no inspector ever found a trace of termites or other damaging insects.
Once again, a HUGELY profitable industry was built on subtracting money from peoples paychecks and that is monthly pest control contracts because people dont want to bother.