**2.2 CSR and Tomáš Baťa responsible entrepreneurship**

Historical records are witnesses of the CSR and pioneering thoughts of responsible capitalism characteristics also in our region. The T. & A. Baťa Shoe Company (Bata Shoes factory) was founded in 1894 by Tomáš Baťa in Moravian town Zlín with his siblings Antonin and Anna, (then Austro-Hungarian Empire, today Czechia). After his brother's death he gained sole control over the business in 1908. The company was growing due to the innovative entrepreneurship of Tomas Bata, who made use of knowledge and experience of the family business and also knowledge and machine production experience gained in the USA. He introduced first automated shoe-production techniques in former Czechoslovakia. Its first mass product, that received the nickname "Baťovky," was a leather and textile shoe for working-class that was notable for its simplicity, style, light weight, and affordable price [15, 16].

The first significant problems appeared in 1922 when an economic slump in the global economy, and in the newly created country of Czechoslovakia causing at the time hardship after WWI, marked by 75% currency devaluation. The decline in demand for products led to lowering production levels and soaring numbers of unemployment. The entrepreneur Tomáš Baťa's respond to the crisis was cutting the prices of Bata shoes in half, this decision caused an expansion of the business as demand for the inexpensive shoes grew rapidly between 1923 and 1925, although other competitors were closing plants due to the in crisis lost demand. The company's workers were offered not to lose their job, but their wages were temporarily reduced by 40 percent during the crisis, with which they agreed. Moreover, Mr. Baťa provided them with food, clothing, and other necessities at half-price in the company's shop. The consumers welcomed the price decline and sales grew [15–18].

The tragic death of Tomas Bata in 1932 did not cease his unrealised plans, as his half-brother Jan Antonín Baťa took over ownership of the Bata companies and carried on performing Tomas Bata visionary plans. He continued in expanding the business into new foreign markets and diversified it into new fields (e.g. Zlin aircraft planes and engines) with enthusiasm and brevity and inspired all around him loyalty. Tomas Bata was his excellent mentor, almost as a father and a great role model [15–18].

Each Baťa factory was divided into guilds centres (business units) covering the entire manufacturing process and each guild centre was made responsible for its share of work in process thereby it motivated the entire centre for high quality performance. After adding its portion of work and value the guild centre sold the semi-product to another guild centre. Faulty or defective work could not be sold. The controllers were not needed (saving in operation costs), the workers themselves were in charge of a high-quality product. Each guild managed production separately and

#### *Integrity of the Corporate Social Responsibility and Management of Financial Services… DOI: http://dx.doi.org/10.5772/intechopen.101057*

rewarded it separately. The guilds competed with one another. Baťa wanted everyone to participate in the success of the factory. He inspired every employee with his moral, role model behavior and his leadership with his charisma motivated them to improve their work and to contribute to higher production that should be beneficial to all. His shoe-sellers had to study ethics and psychology to treat the customers with respect. Tomas Bata was known by his attitude; "everything is possible if one wants". He treated his stakeholders with high respect [15–18].

Bata's thoroughness aimed at high quality products and production efficiency goals led him to manage his supply chain. Bata company's site was logically arranged by grouping tanneries, a brickyard, a chemical factory, a mechanical equipment plant and repair shop, workshops to produce rubber, a paper pulp and cardboard factory (for production of packaging), a fabric factory (for lining for shoes and socks), a shoe-shine factory to oversight the effective efficient production process. In addition, a power plant and farming activities were added to cover food and energy needs. He stressed to be a good manager the following traits are essential when dealing with stakeholders: a) open communication, b) direct and single negotiation, c) goodness and intention to help people, d) building trust in relation with his stakeholders, moreover, he emphasized to pay its debt is a responsible attitude for each well managed enterprise (**Table 1**).

Tomáš Baťa initiated the plan together with Jan Antonin Bata for improvement of working conditions by building Bata villages, they were set up around the factories for the workers and to supply schools and welfare. Employees and their families could benefit from necessary everyday life services and facilities. "Bata-ville" was a typical small town, with educational, cultural, sports, transport and tourism facilities, shops and post office [15, 17, 21, 22]. In 1932, the time of Great Depression, a big world economic crisis, Tomas Bata was asked to construct his Bata shoe factory to help to alleviate unemployment, e.g. in East Tilbury. At the beginnings Batavilles were, in many areas, the only economic source, or main employer for years. Tomas Bata and his brother Jan Antonin, later also Thomas Bata's son expanded


#### **Table 1.** *Bata-villes, source: [15, 19, 20].*
