Sustainability addresses environmental and social issues affecting this and future generations. When family businesses perceive that the community is disrupted, recognizes an environmental problem and responds by implementing new environmental policies or regulations. The family business’s socio-emotional values press to transition to a more sustainable production system, such as the circular Economy. Drawing on the Dubin (1978) methodology, we design a sustainable model, which shows family businesses’ response to changes in the environment. It explains the reasons why family businesses transition to Circular Economy, based on the theory of Socio-Emotional Wealth. We check the model through the case study of the food retail leader in Spanish market, Mercadona that applies policies about energy, resources and waste to became a circular economy business model.