Creating policies that encourage ethical behavior requires an accurate understanding of what drives such behavior. We first describe three common myths about the psychological causes of ethical behavior that can lead policymakers to overlook constructive interventions. These myths suggest that ethical behavior stems from a person’s beliefs; changing behavior therefore requires changing beliefs. Behavioral science, however, indicates that the immediate context (such as an organization’s norms and accepted procedures) exerts a surprisingly powerful influence on behavior. To be effective, policies must treat ethics as a design problem; that is, policymakers should create contexts that promote ethical actions. We then discuss three psychological processes that affect ethical activity—attention, construal, and motivation—and describe how understanding them can help policymakers in the public and private sectors design environments that promote ethical behavior.