["Business Strategy and the Environment, EarlyView. ", "\nABSTRACT\nThe purpose of this study is to examine how family‐owned small restaurants perceive and experience barriers to social and environmental responsibility, as well as the strategies they adopt to address them. Using a qualitative constructivist grounded theory approach, 36 owners and managers were purposively sampled and interviewed until data saturation was achieved. Analysis employed constant comparative, focused, and theoretical coding. Findings reveal that family‐owned small restaurants face key barriers, including financial pressures, resource and infrastructure limitations, regulatory and compliance demands, and human capital constraints. To respond, the constraint–adaptation–sustainability (CAS) model was developed, linking these barriers to strategies such as customer‐oriented strategies, supplier and resource management, and packaging adjustments. This model provides a holistic framework for understanding sustainability integration and offers actionable insights for sustainability‐oriented entrepreneurship in family businesses.\n"]