Helen Clark is in support of the Drug Foundation's stance of a binding cannabis law referendum, as she says the "current policies aren't working".
On TVNZ1's Q+A, the former Prime Minister told host Corin Dann New Zealand should look to countries that have rolled out successful measures in drug policy area.
"I have no doubt that we could do much better."
Miss Clark used the example of Portugal, "which is decriminalisation surrounded by massive harm reduction measures", and described it as the "gold standard".
The possession and consumption of illicit substances were decriminalised in 2001 in Portugal.
She said she supported the Drug Foundation's view there should be a simple binding referendum in 2020 on cannabis laws, with the legislation already established "so people know what they're voting on".
Miss Clark said the public were aware "the current policies aren't working", alongside movement around the world on similar issues.
"Certainly on cannabis decriminalisation and even legalisation in US states and Canada and European jurisdictions.
"And in the area of the other illicit drugs, we’re also seeing a lot of innovation around harm reduction measures. Follow the evidence."
She said it was also worth going back and looking at New Zealand's approach to psychoactive drugs.
"New Zealand did try regulation of some psychoactive drugs back in 2013 that then, for whatever reason, got dropped like a hot cake the following year.
"I think it is worth going back and looking at the principle of that with respect to that particular group of drugs. You have to have regulation and you have to have major harm reduction measures."