diff --git a/projects/rccl/src/include/rccl_common.h b/projects/rccl/src/include/rccl_common.h
index 0e6b19b107..f7110690dc 100644
--- a/projects/rccl/src/include/rccl_common.h
+++ b/projects/rccl/src/include/rccl_common.h
@@ -91,4 +91,6 @@ void rcclSetPxn(struct ncclComm* comm,  int& rcclPxnDisable);
 void rcclSetP2pNetChunkSize(struct ncclComm* comm,  int& rcclP2pNetChunkSize);
 ncclResult_t rcclFuncMaxSendRecvCount(ncclFunc_t func, int nRanks, size_t count, size_t& maxCount);
 ncclResult_t commSetUnrollFactor(struct ncclComm* comm);
+bool validHsaScratchEnvSetting(const char*hsaScratchEnv, int hipRuntimeVersion, int firmwareVersion, const char* archName);
+int parseFirmwareVersion(const char* command);
 #endif
diff --git a/projects/rccl/src/init.cc b/projects/rccl/src/init.cc
index 795105ee7d..c428488294 100644
--- a/projects/rccl/src/init.cc
+++ b/projects/rccl/src/init.cc
@@ -130,7 +130,24 @@ ncclResult_t initGdrCopy() {
 static ncclResult_t initResult = ncclSuccess;
 static pthread_once_t initOnceControl = PTHREAD_ONCE_INIT;
 
+ncclResult_t checkHsaEnvSetting() {
+  const char* hsaScratchEnv = getenv("HSA_NO_SCRATCH_RECLAIM");
+  int hipRuntimeVersion = 0;
+  // hipVer is an integer e.g., 6.2.41133 -> 60241133
+  CUDACHECK(hipRuntimeGetVersion(&hipRuntimeVersion));
+  const int firmwareVersion = parseFirmwareVersion("amd-smi firmware");
+  hipDeviceProp_t devProp;
+  // use GPU0 should be good enough
+  CUDACHECK(hipGetDeviceProperties(&devProp, 0));
+  INFO(NCCL_INIT, "Hipruntime version: %d, firmware version: %d", hipRuntimeVersion, firmwareVersion);
+  if (!validHsaScratchEnvSetting(hsaScratchEnv, hipRuntimeVersion, firmwareVersion, devProp.gcnArchName)) {
+    WARN("HSA_NO_SCRATCH_RECLAIM=1 must be set to avoid RCCL perf hit, rocm ver:%d", hipRuntimeVersion);
+    return ncclSystemError;
+  }
+  return ncclSuccess;
+}
 static void initOnceFunc() {
+  NCCLCHECKGOTO(checkHsaEnvSetting(), initResult, exit);
   initEnv();
   initGdrCopy();
   // Always initialize bootstrap network
@@ -175,13 +192,6 @@ static ncclResult_t ncclInit() {
         WARN("Missing \"HSA_FORCE_FINE_GRAIN_PCIE=1\" from environment which can lead to low RCCL performance, system instablity or hang!");
 #endif
     }
-  const char* hsaScratchEnv = getenv("HSA_NO_SCRATCH_RECLAIM");
-  int hipRuntimeVersion = 0;
-  // hipVer is an integer e.g., 6.2.41133 -> 60241133
-  CUDACHECK(hipRuntimeGetVersion(&hipRuntimeVersion));
-  if ((!hsaScratchEnv || strcmp(hsaScratchEnv,"1") != 0) && hipRuntimeVersion < 60400000){
-    WARN("HSA_NO_SCRATCH_RECLAIM=1 must be set to avoid RCCL perf hit for rocm older than 6.4,, rocm ver:%d", hipRuntimeVersion);
-  }
   pthread_once(&initOnceControl, initOnceFunc);
   return initResult;
 }
diff --git a/projects/rccl/src/rccl_wrap.cc b/projects/rccl/src/rccl_wrap.cc
index 716b564d84..ece9f62f86 100644
--- a/projects/rccl/src/rccl_wrap.cc
+++ b/projects/rccl/src/rccl_wrap.cc
@@ -183,7 +183,7 @@ void rcclSetPxn(struct ncclComm* comm,  int& rcclPxnDisable) {
     const char *inputStr = getenv("NCCL_PXN_DISABLE");
     const bool archGfx942 = IsArchMatch(comm->topo->nodes[GPU].nodes[0].gpu.gcn, "gfx942");
     const bool archGfx950 = IsArchMatch(comm->topo->nodes[GPU].nodes[0].gpu.gcn, "gfx950");
-    comm->enableCustColl = (archGfx942 || archGfx950) && (inputStr && !atoi(inputStr));   
+    comm->enableCustColl = (archGfx942 || archGfx950) && (inputStr && !atoi(inputStr));
 
     if((!archGfx942 && !archGfx950) || inputStr) {
       rcclPxnDisable = pxnDisable = RCCL_VALUE_INVALID;
@@ -242,3 +242,82 @@ ncclResult_t commSetUnrollFactor(struct ncclComm* comm) {
   INFO(NCCL_INIT, "RCCL Unroll Factor (pre-set): %d", comm->unroll+1);
   return ncclSuccess;
 }
+
+std::string trimString(const std::string& s) {
+  int sz = s.size();
+  int b = 0;
+  int e = sz - 1;
+  while (b < sz && isspace(s[b])) {
+    b++;
+  }
+  if (b >= sz) {
+    return "";
+  }
+
+  while (e >= b && e < sz && isspace(s[e])) {
+    e--;
+  }
+  if (b > e) {
+    return "";
+  }
+  return s.substr(b, e - b + 1);
+}
+
+std::vector<std::string> splitString(const std::string& s, char delimiter) {
+  std::vector<std::string> tokens;
+  std::stringstream ss(s);
+  std::string token;
+
+  while (std::getline(ss, token, delimiter)) {
+    tokens.push_back(trimString(token));
+  }
+  return tokens;
+}
+
+int parseFirmwareVersionImpl(FILE* file) {
+  constexpr std::size_t MAX_LINE_SZ = 1024;
+  char line[MAX_LINE_SZ];
+  bool found_pattern = false;
+  while (fgets(line, MAX_LINE_SZ, file)) {
+    auto parts = splitString(line, ':');
+    if (parts == std::vector<std::string>{"FW_ID", "CP_MEC1"}) {
+      if (!found_pattern) {
+        found_pattern = true;
+      }
+      continue;
+    }
+
+    if (found_pattern && (parts[0] == "FW_VERSION")) {
+      return stoi(parts[1]) & 0x7ff;
+    }
+  }
+  return -1;
+}
+
+int parseFirmwareVersion(const char* command) {
+  auto file = popen(command, "r");
+  if (file == nullptr) {
+    return -1;
+  }
+  int version = -1;
+  try {
+    version = parseFirmwareVersionImpl(file);
+  } catch (const std::exception& ex) {
+  }
+  pclose(file);
+  return version;
+}
+
+bool validHsaScratchEnvSetting(const char*hsaScratchEnv, int hipRuntimeVersion, int firmwareVersion, char const* archName) {
+  bool hsaScratchEnvSet = (hsaScratchEnv && strcmp(hsaScratchEnv,"1") == 0);
+  if (hsaScratchEnvSet) {
+    return true;
+  }
+  if (IsArchMatch(archName, "gfx950")) {
+    return (hipRuntimeVersion >= 60443484 && firmwareVersion >= 24);
+  }
+  if (IsArchMatch(archName, "gfx942")) {
+    return (hipRuntimeVersion >= 60443484 && firmwareVersion >= 177);
+  }
+  return true;
+}
diff --git a/projects/rccl/test/RcclWrapTests.cpp b/projects/rccl/test/RcclWrapTests.cpp
index cdb1662667..31780c9b07 100644
--- a/projects/rccl/test/RcclWrapTests.cpp
+++ b/projects/rccl/test/RcclWrapTests.cpp
@@ -333,6 +333,30 @@ TEST(Rcclwrap, RcclUpdateCollectiveProtocol_SimpleFallbackWhenNoRanges) {
   delete comm;
 }
 
+TEST(Rcclwrap, validHsaScratchEnvSettingTest) {
+  // When HSA_NO_SCRATCH_RECLAIM is set, it is always valid
+  EXPECT_TRUE(validHsaScratchEnvSetting("1", 0, 0, "gfx950"));
+
+  EXPECT_TRUE(validHsaScratchEnvSetting("1", 0, 0, "gfx942"));
+
+  // When HSA_NO_SCRATCH_RECLAIM is not set, looking at hip version and firmware version
+  EXPECT_TRUE(validHsaScratchEnvSetting(nullptr, 60443484, 24, "gfx950"));
+
+  EXPECT_FALSE(validHsaScratchEnvSetting(nullptr, 60443483, 24, "gfx950"));
+
+  EXPECT_FALSE(validHsaScratchEnvSetting(nullptr, 60443484, 23, "gfx950"));
+
+  EXPECT_TRUE(validHsaScratchEnvSetting(nullptr, 60443484, 177, "gfx942"));
+
+  EXPECT_FALSE(validHsaScratchEnvSetting(nullptr, 60443484, 176, "gfx942"));
+
+  EXPECT_FALSE(validHsaScratchEnvSetting(nullptr, 60443483, 177, "gfx942"));
+
+  EXPECT_TRUE(validHsaScratchEnvSetting(nullptr, 60443483, 0, "gfx000"));
+
+  EXPECT_TRUE(validHsaScratchEnvSetting(nullptr, 60300000, 0, "gfx000"));
+}
+
 TEST(Rcclwrap, RcclUpdateThreadThreshold_UserEnvSet) {
   const char *value = getenv("NCCL_THREAD_THRESHOLDS");
 
@@ -1687,4 +1711,4 @@ TEST(Rcclwrap, PXN_ZeroRanks_GFX950) {
   CleanupMockComm(mockComm);
 }
 
-} // namespace RcclUnitTesting
\ No newline at end of file
+} // namespace RcclUnitTesting