When you reform something, you change it for the better. If you're running for President, you might promise to reform government, although it's easier to promise reform than to actually accomplish it.
If you take the parts of reform, re- and form, you can see that it means “to shape again.” We often use it to talk about correcting what's wrong in a system, and if you reform something, you make it better and more fair. Juvenile delinquents might be sent to reform school to become better people. Someone fighting alcoholism might try to reform her ways. It's not always about morals: in chemistry, you reform molecules by breaking them apart.