Sustainable development demands radical rethinking of national economies, now mainly based on a linear approach. The transition to a circular one requires crucial innovations and disruptive changes and, despite the interest about this topic, the circular economy is insufficiently implemented. This paper intents to demonstrate that circular economy is a manner of rearranging the economies on sustainable development economic, social and environmental requirements. The aim of this paper is to assess the readiness of the economies belonging to the European Union (EU) to migrate from the actual linear economy to a circular one through a methodology which incorporates economic, social and environmental factors and delivers a composite index. This index is based on a ready to use original unified framework, based on the three pillars of the sustainable development – economic, social and environmental, each founded on two relevant factors. The index is useful for the diagnosis of current situation and allows the identification of the best EU players in terms of readiness of EU nations to pass to a sustainable circular economy. The findings of this paper add value to the current knowledge on circular economy and portray the circularity as being grounded on a safe, rational and socially just transformation. The results of this paper provide a tool that may be used by national and European decision makers/regulators to identify the best/worst practices, which can be replicated/addressed in order to accelerate the transition of the EU to circularity.Copyright © 2020 Elsevier B.V. All rights reserved.